Commissioner of Income Tax (Central), Kanpur vs Commercial Auto Sales (P.) Ltd.

The Income Tax Appellate Tribunal, Allahabad, has referred the following question of law u/s 256(1) of the Income Tax Act, 1961 (hereinafter referred to as ''the Act'') for opinion to this court :

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the provisions of section 43B of the Income Tax Act, 1961 are not applicable ?"

The present reference relates to the assessment year 1986-87.

Assessment year (sic) in question, respondent-assessee had realised sales tax from its customers, which was paid over to the Sales Tax department within the statutory period even though it fell in the subsequent year. The assessing authority added the amount by invoking the provisions of section 43B of the Act. However, the Tribunal has allowed the claim of the respondent-assessee.

We have heard Sri AN Mahajan, learned standing counsel for the revenue. Nobody has appeared on behalf of the respondent-assessee.

In view of the decision of the Apex Court in the case of Allied Motors (P.) Ltd. Vs. Commissioner of Income Tax, Delhi, , the amount of sales tax which has been realised in one year paid over to the Sales Tax department within the statutory period in the subsequent year cannot be added in the income of the assessee invoking the provisions of section 43B of the Act. We, accordingly, answer the question referred to us in the affirmative, i.e., in favour of the assessee and against the revenue. However, there shall be no order as to costs.