2002 (7) TMI 20

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....sions of section 43B of the Income-tax Act, 1961 ?" In this reference, the only dispute is about disallowance under section 43B for unpaid sum of Rs. 2,22,620 for sales tax. It is the stand of the assessee before the assessing authority that the State Government had allowed the assessee to return sales tax collected as a sort of incentive provided for the growth of industry. On this basis, it was contended by the assessee that its case was covered by the provisions contained in section 43B of the Income-tax Act. The Income-tax Officer has, however, rejected the assessee's claim. Being aggrieved by the said order of the Income-tax Officer, the assessee has preferred an appeal before the Commissioner of Income-tax (Appeals) and while di....

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....e Gujarat Government are satisfied. The Tribunal, therefore, held that the amount of Rs. 2,22,620 of deferred sales tax is not caught by mischief of section 43B of the Act. Being aggrieved by the aforesaid decision of the Tribunal, the Revenue has come in reference before this court and the above question was referred for the opinion of this court. Heard Mr. Tanvish Bhatt, learned standing counsel appearing for the applicant-Revenue. Nobody appears on behalf of the respondent-assessee though the notice was duly served, At the time of hearing of this reference, our attention is drawn to the decision of the Supreme Court in the case of CIT v. Gujarat Polycrete (P.) Ltd. [2000] 246 ITR 463, wherein it is held that the Central Board of Di....

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....it as given vide circular dated September 25, 1987, wherein the Board has made it clear that if the sales tax due to the Government is converted as a loan which may be repaid by the assessee subsequently by instalments, the Department shall treat the sales tax dues as actually paid for all purposes, is available to the assessee. The combined reading of this circular of the Central Board of Direct Taxes as well as the resolution issued by the State Government would make it clear that the assessee is entitled to relief and benefit given under section 43B can be claimed by the assessee. It is required to be noted here that subsequently, the State Government has made an amendment in the Gujarat Sales Tax Act and a second proviso to section 4....