The Income Tax Appellate Tribunal ( ITAT ) Mumbai bench held that the relief u/s 43B of the Income Tax Act can be availed if the VAT liability was paid before the due date of filing the return.
The assessee challenged the impugned order dated 09/12/2021 passed under section 250 of the Income Tax Act, 1961 (the Act) by the Commissioner of Income Tax (Appeals) for the assessment year 2017–18.
The assessee declared a loss of Rs. 60,71,766 in the income return filed, whereby disallowance of Rs. 1,07,07,160 under section 43B of the Act was made. CIT(A) dismissed the appeal and confirmed the addition made vide intimation issued under section 143(1) of the Act in the absence of any detail on payment of VAT liability.
It was contended by the assessee that he made the payment in respect of VAT liability before the due date of filing of return u/s 139(1) which was allowable under section 43B of the Act. The assessee submitted the details of payment of VAT liability along with a sample copy of challans and stated that due to COVID-related restrictions, the office of the assessee was not properly functioning which lead to failure in the submission of necessary details before CIT(A).
It was evident from the provision of section 43B of the Act, that any sum payable by the assessee by way of tax, duty, cess or fee shall be allowable in computing the income of that previous year in which such sum is paid by the assessee.
Shri Om Prakash Kant, Accountant Member and Shri Sandeep Singh Karhail, judicial member remanded the issue and directed to grant relief to the assessee under section 43B of the Act, if upon verification found that the VAT liability was paid by the assessee before the due date of filing return under section 139(1) of the Act.
The appeal was allowed for statistical purposes. The assessee was represented by Jitendra Singh and the revenue represented Smt. Smita Nair.
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