2020 (2) TMI 1220

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....ome Tax Act, 1961 (here-in-after referred to as "the Act") dt. 07/03/2014 relevant to the Assessment Year 2010- 2011. The assessee has raised the following grounds of appeal. 1. The learned CIT(A) erred in law and facts in upholding the addition made by learned AO on account of reversal of excise duty of Rs, 11,47,325 on the ground that the same was not paid and therefore not allowable under section 43B of the Income-tax Act, 1961 ('the Act'). 2. The learned CIT(A) as well as the learned AO erred in law by doubly taxing the amount of reversal of excise duty which was earlier offered to tax amounting to Rs. 11,47,325 under section 43B of the Act. 2.1 The learned CIT(A) acted contra legem by upholdi....

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....erefore the assessee accordingly claimed as expenses in its computation of income by applying the provision of section 43B of the Act. 4.1 However the AO was of the view that the provision of section 43B is applicable where the outstanding liabilities of the previous year have been paid during the year under consideration. However, the assessee did not furnish any documentary evidence in support of its claim made in the return of income. Therefore in the absence of any evidence from which it can be proved that the assessee has made the payment of existing liabilities in the year under consideration, it cannot take shelter of the provision of section 43B of the Income Tax Act. 4.2 The AO also noted that the assessee in the year under c....

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....se duty made by the AO. 7. Being aggrieved by the order of the Ld. CIT-A, the assessee is in appeal before us. The Ld. AR for the assessee before us filed a paper book running from pages 1 to 134 and submitted that it has been following the practice for creating the provision in one year but reversing in the subsequent year. The ld. AR further submitted that the amount of provision created for Rs. 11,47,325.00 has already suffered the tax in the immediate preceding AY. Therefore, the same cannot be taxed in the year under consideration. 8. On the other hand, the learned DR vehemently supported the order of the authorities below. 9. We have heard the rival contentions of both the parties and perused the materials available on rec....