2007 (9) TMI 238

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....ered by MADAN B. LOKUR, J - The Revenue is aggrieved by an order dated 17^th November, 2006 passed by the Income Tax Appellate Tribunal ('Tribunal') Delhi Bench 'D' New Delhi in ITA No. 2910/Del/2004 relevant for the assessment year 1999-2000. 2. The assessee maintains a mercantile system of accounting. It had collected service tax during the previous year relevant to the assessment year in ....

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....a High Court in Chowringhee Sales Bureau P. Ltd. v. Commissioner of Income Tax, (1977) 110 ITR 385. 4. In appeal, the Tribunal was of the opinion that in view of the provisions of Section 43B of the Income Tax Act, 1961('Act'), since the assessee had not claimed a deduction there was no question of disallowing the deduction which was not even claimed. The relevant extract of Section 43B of the ....

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....u P. Ltd. [1977] 110 ITR 385, covers the point in its favour. We are unable to agree. In that case it was held that the liability to pay sales tax arose the moment a sale or purchase was effected and if an assessee was maintaining accounts on the mercantile system it would be entitled to deduction of the estimated liability of sales tax, even though such sales tax had not been paid to the sales ta....