Search Results For: 43B


CIT vs. Gujarat Cypromet Ltd (Supreme Court)

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DATE: February 21, 2019 (Date of pronouncement)
DATE: April 29, 2019 (Date of publication)
AY: 2001-02
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CITATION:
S. 43B: The conversion of outstanding interest into loan does not amount to "actual payment" of the interest in order to qualify for deduction in view of the retrospective insertion of Explanation 3C to s. 43B (Eicher Motors 315 ITR 312 (MP) & Pennar Profiles (T&AP) approved)

Expln. 3C has now in clear terms provided that such conversion of interest amount into loan shall not be deemed to be regarded as “actually paid” amount within the meaning of Section 43B. In view of clear legislative mandate removing this doubt and making the intention of legislature clear in relation to such transaction, it is not now necessary for this Court to interpret the unamended Section 43B in detail, nor it is necessary for this Court to take note of facts in detail as also the submissions urged in support of various contentions except to place reliance on Expln. 3C to Section 43B and answer the questions against the assessee and in favour of Revenue

CIT vs. Knight Frank (India) Pvt. Ltd (Bombay High Court)

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DATE: August 16, 2016 (Date of pronouncement)
DATE: August 30, 2016 (Date of publication)
AY: 2007-08, 2008-09
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S. 145A(a)(ii) applies only to goods and not services. Service-tax billed on rendering of services is not includible as trading receipts. No disallowance u/s 43B can be made for the unpaid service-tax liability which is not claimed as a deduction

It is very clear from the reading of Section 145A(a)(ii) of the Act that it only covers cases where the amount of tax, duty, cess or fee is actually paid or incurred by the assessee to bring the goods to the place of its location and condition as on the date of valuation

CIT vs. M. M. Aqua Technologies Ltd (Delhi High Court)

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DATE: July 22, 2016 (Date of pronouncement)
DATE: August 3, 2016 (Date of publication)
AY: 1996-97
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S. 43B: Issue of debentures to fund the interest liability does not amount to “actual payment” of the interest so as to qualify for deduction under Explanation 3C to Section 43-B

The question which has to be decided is whether the decision of this court in CIT vs. M. M. Aqua Technologies Ltd, which held that because of Explanation 3C to Section 43-B, any adjustment other than actual payment does not qualify for deduction under Section 43-B. As is evident from the discussion, the assessee’s review is premised on two major arguments, i.e. that the judgments of the Supreme Court in Standard Chartered Bank v Andhra Bank, 2006 (6) SCC 94 and Sunrise Associates vs Govt. of NCT of Delhi & Ors. 2006 (5) SCC 603, have categorically held that debentures (issued in favour of the bank, in this case to discharge interest liability) amounted to payment and that such debentures, being actionable claims and securities, were to be deemed paid once issued

DCIT vs. Alstom Projects Ltd (ITAT Mumbai)

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DATE: October 28, 2015 (Date of pronouncement)
DATE: May 26, 2016 (Date of publication)
AY: 2007-08 & 2008-09
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CITATION:
(i) Important law laid down on applicability of transfer pricing provisions to non-AEs, Law on (ii) deductibility of unpaid service-tax u/s 43B and (iii) carry forward of losses of amalgamating company u/s 72A and Rule 9C explained

Disallowance of unpaid service tax could not be made under section 43B where the assessee did not claim the same in its Profit and Loss account. Where the assessee fulfilled all the conditions prescribed under Section 72A read with Rule 9C, the AO could not deny the claim of carry forward of losses pertaining to the amalgamating company

Munaf Ibrahim Memon vs. ITO (ITAT Pune)

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DATE: October 30, 2015 (Date of pronouncement)
DATE: November 27, 2015 (Date of publication)
AY: 2009-10
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S. 43B/ 145A: Taxes collected by the assessee, which remain unpaid, have to be added to the income even if the same are not debited to the P&L A/c and claimed as a deduction

In view of the provisions of the Act i.e. section 145A of the Act, we find no merit in the plea of the assessee in not recognizing the VAT attributable to its sales as part of the sale consideration of the goods while computing its Profit & Loss Account. The mandatory provisions of Central Act i.e. section 145A of the Act supersedes the provisions of any State Act i.e. Maharashtra Value Added Tax Act, 2002. Once the assessee recognized the VAT amount as part of the sale consideration, it tantamount to the said entry being routed through the Profit & Loss Account, especially in the cases where the assessee is following mercantile system of accounting

CIT vs. Ovira Logistics (P) Ltd (Bombay High Court)

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DATE: April 17, 2015 (Date of pronouncement)
DATE: August 10, 2015 (Date of publication)
AY: 2007-08
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CITATION:
S. 43B: Service-tax billed to customer but not collected from him cannot be disallowed u/s 43B on ground of non-payment to treasury

Section 43B does not contemplate liability to pay the service tax before actual receipt of the funds in the account of the assesee. Liability to pay service tax into the treasury will arise only upon the assessee receiving the funds and not otherwise

DCIT vs. Jyoti Ltd (ITAT Ahmedabad)

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DATE: June 25, 2015 (Date of pronouncement)
DATE: June 30, 2015 (Date of publication)
AY: 2005-06 to 2007-08
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S. 43B(e): Conversion of outstanding interest into a loan does not constitute "actual payment" of the interest so as to qualify for deduction

On perusing Section 43B(e), it is seen that interest on any loan or advance from a schedule bank, in accordance with terms and conditions of the agreement governing such loans or advance, would be allowed as deduction in the previous year in which sum is actually paid by the Assessee

CIT vs. M. M. Aqua Technologies Ltd (Delhi High Court)

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DATE: May 18, 2015 (Date of pronouncement)
DATE: May 27, 2015 (Date of publication)
AY: 1996-97
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CITATION:
S. 43B Expl 3C: Conversion of outstanding interest into a loan does not amount to an "actual payment" of the interest and so deduction for the interest cannot be claimed

In view of the Explanation 3C appended to Section 43B with retrospective effect from 01.04.1989, conversion of interest amount into loan would not be deemed to be regarded as actually paid amount within the meaning of Section 43B of the Act

Travancore Sugars & Chemicals Ltd (Supreme Court)

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DATE: May 7, 2015 (Date of pronouncement)
DATE: May 19, 2015 (Date of publication)
AY: 1990-91
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CITATION:
S. 43B: "Vend fee" paid by the assessee to the Government, even if of the nature of "privilege fee" falls within the expression "fee by whatever name called"

A reading of Section 43B after it was substituted by the Finance Act, 1988 with effect from 01.04.1989 shows that sub clause (a) in Section 43B has been considerably widened by the amendment by the addition of the words “by whatever name called”. It is clear, therefore, that to attract this section any sum that is payable whether it is called tax, duty, cess or fee or called by some other name, becomes a deduction allowable under the said Section provided that in the previous year, relevant to the assessment year, such sum should be actually paid by the assessee

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