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TMI Blog2015 (6) TMI 850X X X X Extracts X X X X X X X X Extracts X X X X ..... hs are reproduced below: "2. The disallowance on account of deferment of sales-tax of Rs. 42,21,000/- has been made in the assessment as the assessee company has not produced any evidence to show that the above liability had been converted into loan. The deduction in respect of the amount of sales-tax liability, converted into loan, shall be allowed only if such conversion has been permitted and approved by the respective government and the assessee has to produce the necessary certificate in Form No.D, issued by the State Government in this regard. The assessee company, however, had not produced any such details/certificate. The Assessing Officer, therefore, disallowed the above liability u/s.43B of the Act. In Appeal, the Ld. CIT(A) dele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or your kind perusal. 4. In view of above, this Miscellaneous Application is being filed to draw attention of the ITAT in the above matter." 3. According to learned Sr.D.R., although it is not in dispute that there was a provision for providing a deferment of the Sales Tax liability but the learned Commissioner was expected to verify the quantum of the claim since the order was silent on this issue, therefore, the learned Tribunal as well has committed an error. This Misc. Application has been filed to rectify that error. 4. From the side of the respondent-assessee, learned AR, Mr. S.N. Soparkar appeared and pleaded that the Respected Tribunal has considered all those aspects and thereupon passed a detailed order. He has placed reliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales-tax of Rs. 42.21 lakhs pertaining to current year. These liabilities of current year can only be deductible provided that the same was convened into loans and deferment for payment was allowed during the previous year in this regard. A copy of letter dated 23.03.2007 produced by the assessee from Commercial Department, Belgaum does not specifically speak about conversion of Sales tax liability into loan during the previous year itself and therefore,; it is not established that the deferment had actually been allowed during the previous year itself. The letter produced by the assessee has been issued by the Sales-tax department as late as on 23.03.2007 and it did not indicate the actual date of conversion of deferment of Sales-tax liabi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort, the learned C1T(A) deleted the disallowance by observing in his order vide paragraph 3.2 as under : "3.2. The submissions made by the A.Rs have been verified and the documents furnished are also examined. It is seen that the appellant has been given the Sales Tax liability deferment benefit by the Karnataka Government; Therefore I find that the appellant's claim is in its order. Form No.D as in Gujarat Government is not applicable to unit in Karnataka Government. Hence, the A.O. is directed to delete the disallowance made by him. Therefore, this ground of appeal is allowed." 4. Heard both parties and perused the material on record. To resolve the controversy, we may first refer to Circle No.496 (F.No.201/34/86-IT(A-II) dt.25.9.19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Law has opined that if the State Governments make an amendment in the Salestax Act to the effect that the sales-tax deferred under the scheme shall be treated as actually paid, such a deeming provision will meet the requirement of s. 43B. 5. The Government of Maharashtra have by the Bombay Sales- tax (Amendment) Act, 1987, made the amendment accordingly. The Board, have decided that where amendments are made in the salestax laws on these lines, the statutory liability shall be treated to have been discharged for the purposes of s. 43B of the Act. 6. The CITs may bring the contents of this Circular to the notice of all the officers working under them." SOURCE : [Reported in (1988) 68 CTR (St) 109 : (1988) 169 ITR (St) 53] 5. From the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titled for deferment shall be payable by the assessee's unit over a period of 5 years in ten equal half yearly installments commencing from the date of expiry of the period of deferment i.e. with effect from 14.12.2009. In view of the above factual matrix, we are of the considered view that the assessee having fulfilled all the conditions, the learned CIT(A) is perfectly justified in deleting the addition of Rs. 42,21,000 on account of deferment of sales tax. Accordingly, we dismiss ground No.1 of the Revenue." 5. In the light of the above, we have heard both the sides. At the outset, it is worth to mention that the Respected Co-ordinate Bench has discussed this issue at length after considering the facts of the case as well as the connect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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