Question And Answer
Subject: Allowability of SAD Refund denied by Custom Authorites
Querist: Arun Kumar Arora
Answered by:
Tags: ,
Date: May 23, 2021
Query asked by Arun Kumar Arora

SAD Refund was applied 6 to 7 years ago with  the Custom Authorities.The said amount was shown as Refund Receivable in the Balance Sheet in the year of payment of SAD custom Duty. However , the same was never offered as income. Now Custom department has rejected the said Refund application and the said amount has been debited to Profit and Loss Account.Whether this amount is allowable in current year in view of Provisions of Section 43-B,Bad Debts and Prior Period Expenses.

File Uploaded: Not Available

Answer given by

It may be difficult to answer without knowing the full facts . We presume that the assessee had made a claim for refund of custom duty paid and shown it as receivable in the balance sheet . In case the assessee has shown the custom duty refund as income in the profit and loss account and offered the income for taxation , when the claim is rejected the assessee can claim as business loss or bad debt , however if income is not offered as income the claim is not allowable . The tax consultant may be able to guide after verifying the facts .

Disclaimer: This article is only for general information and is not intended to provide legal advice. Readers desiring legal advice should consult with an experienced professional to understand the current law and how it may apply to the facts of their case. Neither the author nor and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this article nor for any actions taken in reliance thereon. No part of this document should be distributed or copied (except for personal, non-commercial use) without express written permission of

Leave a Reply

Your email address will not be published. Required fields are marked *