Section 43B coverage of excise kist rejected under the Karnataka Excise Act, favouring the assessee.

On the changed provisions of the Karnataka Excise Act, particularly section 24, the Karnataka High Court held that the kist amount payable to the Government did not fall within the ambit of section 43B of the Income-tax Act, 1961. The court followed its earlier ruling on the same point and upheld the Tribunal's view that the kist liability could not be brought within section 43B. The issue was therefore resolved in favour of the assessee and against the Revenue.

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Issues: Whether the kist amount payable to the Government under the Karnataka Excise Act was liable to be brought within the purview of section 43B of the Income-tax Act, 1961.

Analysis: The question was answered by following the earlier decision on the same point. The holding was that, on the changed provisions of the Karnataka Excise Act, particularly section 24, the kist amount payable by the assessee to the Government did not fall within the ambit of section 43B of the Income-tax Act, 1961.

Conclusion: The Tribunal was right in holding that the kist amount could not be brought within section 43B, and the answer was in favour of the assessee and against the Revenue.

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