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TMI Blog2019 (3) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... ctly invoking provisions of section 37 of the Income Tax Act, 1961 and thereby incorrectly denying the expenditure on account of Local Body Tax (LBT) claimed by the assessee amounting to Rs. 43,73,913/- for the reason that the said expenditure pertains to prior period though the said deduction was squarely available to the assessee under section 43B. 2. On the facts & in circumstances of the case & in law, alternatively it is submitted that the appellant shall be granted deduction of Rs. 43,73,913/- under section 43B as the appellant has complied with provisions of the said section. 3. The only issue raised in the present appeal is against denial of expenditure incurred on account of Local Body Tax (LBT) amounting to Rs. 43,73,913/- whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hence, the disallowance of Rs. 43,73,993/-. 5. The CIT(A) upheld the aforesaid disallowance made by the Assessing Officer. 6. The assessee is in appeal against the order of CIT(A). 7. The learned Authorized Representative for the assessee pointed out that it was State levy by the Scheduled Municipal Corporation, which is parallel of octroi charges. He further pointed out that part of the amount paid during the year has been allowed but sum of Rs. 43.73 lakhs was disallowed on the basis of it related to prior year. He further pointed out that since the amount was actually paid during the year, hence the claim was made under section 43B of the Act, which was denied by the Assessing Officer on the ground that it was not debited to the acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... BT paid for the earlier period of Rs. 43,73,913/- was disallowed in the hands of assessee. The claim of assessee was in line with the provisions of section 43B of the Act. The said section provides that deduction in respect of any sum payable by the assessee by way of tax, duty, cess or fees or whatever name called, under any law for the time being in force ..., to be allowed in the year of payment, irrespective of the previous year in which the liability to pay such sum was incurred by the assessee, according to the method of accounting regularly employed by it. The said deduction is to be allowed while computing the income under section 28 of that previous year in which such sum was actually paid by him. Such is the proposition laid down ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of section 43B of the Act. We find no merit in the orders of authorities below in denying the same to the assessee on the ground that the amount was not shown as payable in the preceding year. The express provisions of section 43B of the Act provides that irrespective of previous year in which the liability to pay such sum was incurred by the assessee, according to the method of accounting regularly employed by him, the said sum would be allowed only in computing the income referred to in section 28 of that previous year in which such sum is actually paid by him. Accordingly, we hold that the assessee is entitled to the aforesaid claim under section 43B of the Act. 11. Coming to the reliance placed upon by the authorities below on the d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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