2019 (3) TMI 1558

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....Appeal is filed by the Revenue challenging the Judgment of the Income Tax Appellate Tribunal. The following questions have been presented for our consideration : "(i) Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT was correct in allowing deduction u/s 43B of the Act, in respect of provision for payment of excise duty on obsolete inventory, which was not rem....

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....paid. The Assessing Officer, however, objected to a part of his claim to the extent of Rs. 10.06 Lakhs on the ground that the Assessee had treated part of the goods as obsolete and had not cleared for sale in the market. This happened in the later year. 3. It is not in dispute that the Assessee had paid the entire excise duty within the time envisaged under Section 43B of the Income Tax Act, 1961....

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....een the excise duty paid and the goods manufactured in relation to which such excise duty is payable. 6. Section 43B of the Act, as is well-known, requires that, besides other payments, any sum payable by way of tax, duty, cess or fee shall be allowed in computing the income of that previous year in which such sum is actually paid by the Assessee. Proviso to Section 43B would ensure that in relat....

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....hat the excise duty was paid in relation to certain goods manufactured, but the funds were not cleared and that therefore, no excise duty liability arose, the adjustment would automatically be made in the later years when the Assessee would estimate its liability for payment of excise duty. Such a situation may arise under various circumstances such as damage or destruction of the goods. However, ....