ASHUTOSH POWER TRANSBELTS LIMITED,AHMEDABAD vs. ITO, WARD-1(1)(3), AHMEDABAD

PDF · subscribers
ITA 727/AHD/2026Status: DisposedITAT Ahmedabad03 August 2026AY 2023-20244 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee is eligible for deduction under Section 43B if the old outstanding professional tax was paid in the current year. The matter was set aside to the AO for verification of the revised tax audit report and payments.

What were the facts?

The assessee claimed deduction for professional tax paid in the current year, which was disallowed in earlier assessment years. The CPC rejected the deduction, and the assessee's rectification application and subsequent appeal were also dismissed.

What were the issues?

Whether the disallowance of professional tax paid in the current year, which was disallowed in earlier years, is allowable as a deduction under Section 43B. Whether a revised tax audit report is necessary to support such a claim.

Which sections of the Income-tax Act were involved?

Section 43B,Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: SHRI SANJAY GARG & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Ashok Dhariwal, AR
For Respondent: Shri Deependra Kumar, SR-DR
Hearing: 06.07.2026Pronounced: 03.08.2026

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

This appeal is filed by the assessee against the order of Addl/JCIT (Appeal)-1, Hyderabad, [hereinafter referred to as “Addl. CIT(A)”] dated 13.01.2026 for the Assessment Year (A.Y.) 2023-24 in the proceeding u/s 154 of the Income Tax Act [hereinafter referred as “the Act”].

2.

The brief facts of the case are that the assessee had filed its return of income for A.Y. 2023-24 on 30.09.2023. In the said return, the assessee had claimed deduction of Rs.63,880/- u/s. 43B of the Act in respect of professional tax disallowed in A.Y. 2022-23, which was paid in the current year. Thereafter, the assessee had filed a revised return on

ITA No.727/Ahd/2026 Ashutosh Power Transbelts Limited Vs ITO., AY- 2023-24 2

09.12.2023 claiming deduction of Rs.1,23,846/- u/s. 43B of the Act, for the aggregate professional tax disallowed in A.Ys. 2021-22 and 2022-23, and paid in the current year. The CPC, while processing the return of the assessee did not allow the deduction claimed by the assessee u/s. 43B of the Act. Thereafter, the assessee had filed a rectification application u/s. 154 of the Act on 23.12.2023, which was also rejected by the CPC vide order dated 30.01.2024.

3.

Aggrieved with the rejection of application u/s. 154 of the Act, the assessee had filed an appeal before the first appellate authority, which was decided by the Ld. Addl. CIT(A) vide the impugned order and the appeal of the assessee was dismissed. Th

4.

Now the assessee is in second appeal before us. The following grounds have been taken in this appeal:

1.

The Ld. CIT(A) has erred both in law and on facts in confirming the action of the CPC in not allowing deduction of professional tax amounting to Rs. 1,23,846/-, which had been disallowed in earlier assessment years but became allowable during the year under consideration on actual payment basis under section 43B of the Income Tax Act, 1961. 2. The Ld. CIT(A) has further erred in not appreciating that the appellant had actually paid professional tax amounting to Rs. 1,92,200/- on 15.12.2022, which included arrears relating to A.Y. 2021-22 (Rs. 59,966/-) and A.Y. 2022- 23 (Rs. 63,880/-) along with the current year liability. Accordingly, the sum of Rs. 1,23,846/-, representing earlier disallowances, was clearly allowable as deduction in A.Y. 2023-24 in accordance with section 43B which allows deduction on payment basis. The appellant craves leave to add, alter, amend or withdraw any of the above grounds of appeal at or before the time of hearing

5.

Shri Ashok Dhariwal, the Ld. AR of the assessee submitted that the Ld. Addl. CIT(A) had upheld the rejection of rectification application for the

ITA No.727/Ahd/2026 Ashutosh Power Transbelts Limited Vs ITO., AY- 2023-24 3 reason that no revised tax audit report was filed in support of deduction of Rs. 1,23,846/- claimed u/s. 43B of the Act in the revised return. The Ld. AR submitted that the assessee has now filed a revised tax audit report and requested that the matter may be set aside to the file of Jurisdictional AO with a direction to verify the payments made by the assessee and thereafter allow the claim of the assessee.

6.

Per Contra, Shri Deependra Kumar, the Ld. SR-DR had no objection in setting aside the matter to the file of the Jurisdictional AO.

7.

We have considered the rival submissions. In the original return of income, the assessee had made claim for deduction of Rs. 63,880/- only u/s. 43B of the Act, in respect of professional tax disallowed in A.Y. 2022- 23. In the revised return, however, this claim was revised to Rs.1,23,846/- . According to the assessee, professional tax of Rs. 59,966/- and Rs.63,880/- was disallowed in the A.Ys. 2021-22 and 2022-23 respectively, for the reason that these amounts were not paid in the respective years. The assessee had paid these old outstandings in the current year and, therefore, had rightly claimed the deduction for the same in the revised return. The Ld. Addl. CIT(A) had rejected the claim of the assessee for the reason that the claim for deduction of Rs. 1,23,846/- u/s. 43B of the Act was not supported by tax audit report. The assessee has now filed a revised tax audit report before us. So far as deduction u/s. 43B is concerned, there is no dispute to the fact that the assessee is eligible for deduction, if these old outstandings were paid during the current year. In the interest of justice, therefore, we deem it proper to set aside the matter to the file of Jurisdictional AO with a direction to verify the revised tax audit report and also verify the payment of the outstanding

ITA No.727/Ahd/2026 Ashutosh Power Transbelts Limited Vs ITO., AY- 2023-24 4

professional tax of earlier years disallowed in A.Y. 2021-22 and 2022-23, in the current year. Thereafter, the Jurisdictional AO should decide the claim for deduction u/s. 43B of the Act in respect of these payments, as per law.

8.

In the result, the appeal of the assessee is allowed for statistical purpose.

Order pronounced in the Court on 03/08/2026 at Ahmedabad.

Sd/- Sd/- (SANJAY GARG) (NARENDRA PRASAD SINHA) Judicial Member Accountant Member Dated – 03rd August, 2026 (True Copy) Neelesh, Sr. PS आदेश आदेश क� आदेश आदेश क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : अ�ेिषत 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A) 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण / DR, ITAT, 6. गाड� फाईल /Guard file. आदेशानुसार/BY ORDER, आदेशानुसार आदेशानुसार आदेशानुसार पंजीकार (Dy./Asstt.Registrar) उप/सहायक उप सहायक पंजीकार उप उप सहायक सहायक पंजीकार पंजीकार आयकर आयकर अपीलीय आयकर आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, अहमदाबाद अिधकरण अहमदाबाद अहमदाबाद / ITAT, Ahmedabad अहमदाबाद

More judgments on Section 43B

All 7,161 judgments and leading authorities on Section 43B →

Recent GST High Court judgments

Search GST case law →