Ihave made a provision for Tax of Rs 15,000 but next year made a payment of Rs 18,000. I was told Rs

[Guest]

Ihave made a provision for Tax of Rs 15,000 but next year made a payment of Rs 18,000. I was told Rs 3,000 is to be disallowed this year. But am unable to know under which section?

[DEV KUMAR KOTHARI]

For better and correct response, give yr. Q. correctly and compeletely. If it is provision for income-tax or wealth-tax, entire amount is to be disallowed. If it is any other allowable tax, duty, fees etc. then full payment may be allowed if actually paid within prescribed time- due date to file return, provided the payment is agaisnt earlier years liabilty, and there is case of short provision. Disallow provision outstandign as on 31st march Rs. 15000 and claim actual payment for the relevant previous year, made before due date Rs.18000/- . Check whether Rs.18000 is relating to earlier year and any part is not for the year in which payment is made. In that case current liability padi will be allowed in computation of current income.

AI Summary

Clarification Needed on Tax Provision Payment: Rs 3,000 Disallowed; Advice on Claiming Rs 18,000 Explained. An individual inquired about a tax provision of Rs 15,000, but paid Rs 18,000 the following year and was informed that Rs 3,000 would be disallowed. The response suggested clarifying whether the provision was for income or wealth tax, as the entire amount would be disallowed in such cases. For other taxes, full payment may be allowed if paid within the prescribed time against previous liabilities. The advice was to disallow the outstanding provision of Rs 15,000 as of March 31 and claim the actual payment of Rs 18,000 if it pertains to the relevant year.