CIT Vs. SHADI RAM DHARAM CHAND AND CO

JUDGEMENT

(1.) The Income Tax Appellate Tribunal, Allahabad has referred the following question of law under Section 256(1) of the Income Tax Act, 1961,hereinafter inferred to as "the Act", for opinion to this Court:

(2.) The present reference made relates to the assessment year 1985-86. The accounting period of the respondent-assessee ended on 24-10-1984.

(3.) The brief facts of the case are that the Income Tax Officer during the assessment proceedings found that the assessee had shown certain outstanding liability in the balance-sheet on account of sales tax. As the said amount had not been paid during the year, it was added under Section 43B towards the income. The said order was also confirmed by the learned Commissioner (Appeals). In second appeal the Tribunal deleted the said addition on the ground that the alleged amount of sales-tax was realized in the last month of the assessment year and was deposited in the following year when it became due. In this way the alleged amount had not become payable and thus it was not hit by Section 43B.