COMMISSIONER OF INCOME-TAX Vs. DEVENDRA UDHYOG

JUDGEMENT

(1.) THIS appeal is directed against the order dated June 6, 2000. The following questions are raised for our consideration in appeal : " (i) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that the liability for payment of collected sales tax to the Government having been deferred under the said scheme, is allowable under section 43b in spite of the fact that there was no amendment in the Sales Tax Act to the effect that the sales tax deferred under the scheme shall be treated as actually paid as provided in the Central Board of Direct Taxes Circular No. 496, dated September 25, 1987 ([1988] 169 ITR (St.) 53) ? (ii) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law by holding that the Board's Circular No. 674, dated December 29, 1993 ([1994] 205 ITR (St.) 119), is applied in the assessee's case whereas the assessee did not produce any order of the State Government notifying that the sales tax deferred would deemed to have been actually collected and disbursed as loans ?" The brief facts of the case are that the assessee has shown the sales tax incentive under the heading "reserve fund and surpluses" amounting to Rs. 2,34,845 for the assessment year 1989-90. During the course of proceedings, the Assessing Officer found that the amounts were related to the Sales Tax Deferment Scheme for Industries, 1987 of the Government of Rajasthan.

(2.) UNDER the scheme, the assessee had collected the sales tax but not paid to the State Government within the accounting period or before filing of the return of income. The Assessing Officer has invoked the provisions of section 43b and added the amount of Rs. 2,34,845 in the assessment year 1989-90, i. e. , the assessment year in hand.

(3.) CONSEQUENTLY, we set aside the order of the Tribunal and restore the order of the Assessing Officer. The appeal stands disposed of accordingly. .