Kist paid by excise contractors is not duty or tax, so section 43B disallowance does not apply.

Kist payable by an excise contractor to the Government was held not to have the character of duty or tax, so the unpaid amount outstanding at the end of the accounting year did not fall within section 43B of the Income-tax Act, 1961. The provision applies only to specified statutory liabilities, and the described kist was outside its scope. The reference was therefore answered in favour of the assessee and against the Revenue.

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Issues: Whether kist payable by an excise contractor to the Government is duty or tax so as to attract disallowance under section 43B of the Income-tax Act, 1961.

Analysis: The amount described as kist was held not to possess the character of duty or tax. On that footing, the unpaid kist outstanding at the end of the relevant accounting year could not be brought within the scope of section 43B, which applies to specified statutory liabilities.

Conclusion: Kist is not duty or tax and is outside the purview of section 43B of the Income-tax Act, 1961; the reference is answered in favour of the assessee and against the Revenue.

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