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Income Tax - Highlights / Catch Notes

Home Highlights April 2020 Year 2020 This

Constitutional validity of clause (f) of Section 43B - The ...

Case Laws     Income Tax

April 28, 2020

Constitutional validity of clause (f) of Section 43B - The liability of leave encashment continues to be a present liability as per the mercantile system of accounting. Further, the insertion of clause (f) has not extinguished the autonomy of the assessee to follow the mercantile system. It merely defers the benefit of deduction to be availed by the assessee for the purpose of computing his taxable income and links it to the date of actual payment thereof to the employee concerned. Thus, the only effect of the insertion of clause (f) is to regulate the stated deduction by putting it in a special provision. - Provision is constitutionally valid - SC

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