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TMI Blog1998 (2) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... rn under section 139(1), no addition could be made invoking the provisions of section 43B of the Income-tax Act?" The matter relates to the assessment year 1985-86. While making the income-tax assessment of the assessee-company, the Assessing Officer noted that there was unpaid sales tax liability of Rs. 30,123 under the Gujarat Sales Tax Act and of Rs. 39,052 under the Central Sales Tax Act, aggregating to Rs. 69,175 at the end of the accounting period, and, invoking the provisions of section 43B of the said Act, disallowed the said amount. The Commissioner of Income-tax (Appeals) confirmed that order. The Appellate Tribunal, in the appeal by the assessee, following its earlier decision in the case of Chandulal Venichand v. ITO held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It was noted that the proviso was introduced to remove the hardship caused to certain taxpayers who had represented that since sales tax for the last quarter cannot be paid within that previous year, the original provisions of section 43B will unnecessarily involve disallowance of the payment for the last quarter. It was noted that Explanation 2 was added as certain courts had interpreted the provisions of section 43B in a manner which may negate the very operation of the section. It was held that by its very nature the proviso was in a declaratory form. The court observed that it would be unreasonable to say that the sales tax payment for the last quarter should be made within the previous year. It was further observed that if Explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t views were taken concurred with the opinion of this court in the case of Chandulal Venichand [1994] 209 ITR 7, and held that the first proviso was added in section 43B to obviate the unexpected outcome of section 43B, whereby the assessee who had collected sales tax in the last quarter of the accounting year and deposited it in the treasury within the statutory period falling in the next accounting year, was not entitled to claim any deduction for it. It was held that this was not intended by section 43B. The first proviso therefore made it clear that the section will not apply in relation to any sum which was actually paid by the assessee in the next accounting year, if it is paid on or before the due date for furnishing the return of in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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