GST deduction under section 43B requires payment verification before statutory due date for allowability

The ITAT PUNE ruled on GST payment timing under section 43B regarding deduction allowability. The assessee filed ITR under section 139(4) on 29/07/2020, claiming GST liability deduction, but the due date under section 139(1) was 30/10/2019. The CPC disallowed the deduction as GST wasn't paid by the statutory due date. The ITAT found the NFAC's confirmation inadequate as it failed to verify exact GST amounts paid before and after the due date. The matter was remanded to NFAC for proper examination of GST payment timing and a detailed speaking order under section 250(6). The appeal was allowed for statistical purposes.

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Issues:
1. Disallowance of GST under section 43B of the Income-tax Act for failure to discharge statutory dues by the due date of filing the return.
2. Interpretation of whether a belatedly filed income tax return under section 139(4) can be treated as filed under section 139(1) for the purpose of section 43B.
3. Application of legal principles regarding the actual payment of statutory dues within the due date prescribed under section 139(1) of the Act.

Detailed Analysis:
Issue 1: The appellant challenged the disallowance of GST under section 43B for not discharging statutory dues by the due date of filing the return. The National Faceless Appeal Centre upheld the disallowance, stating that the appellant failed to make the payment before the due date. The tribunal noted that the disallowance was made based on the tax audit report and the return filed by the appellant.

Issue 2: The tribunal analyzed whether a return filed under section 139(4) can be treated as filed under section 139(1) for the purpose of section 43B. The appellant argued that the belated filing of the return should be considered as filed under section 139(1) to protect the GST payment from disallowance. However, the tribunal referred to the non-obstante clause in section 43B, which requires actual payment by the due date prescribed under section 139(1) to claim deductions for statutory liabilities.

Issue 3: The tribunal referred to the legal principle that deductions for statutory liabilities under section 43B are allowed if paid within the due date prescribed under section 139(1) or the extended due date. The tribunal emphasized the importance of actual payment within the specified time limits to claim deductions. In this case, the tribunal found that the appellant filed the return after the extended due date, leading to the disallowance of the GST claim under section 43B.

In conclusion, the tribunal allowed the appeal for statistical purposes and directed the matter back to the National Faceless Appeal Centre for a detailed consideration of the GST payment issue in accordance with the law. The tribunal highlighted the significance of timely payment of statutory dues to claim deductions under section 43B of the Income-tax Act.

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