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Facts
The assessee debited Rs.8,74,889/- as sales tax paid under protest in Assessment Year (AY) 2010-11, which pertained to AY 2001-02. The CIT(A) confirmed the disallowance made by the AO.
Held
The Tribunal noted that the amount was not claimed in earlier years and was paid and debited in the current year (AY 2010-11) as it had crystallized. Consequently, the Tribunal found no reason to disallow the expense.
Key Issues
Whether sales tax paid under protest, pertaining to an earlier assessment year but crystallized and paid in the current assessment year, can be allowed as an expense in the current year.
Sections Cited
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD
O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:- Delay Condoned This appeal is filed by the Assessee against the appellate order dated 07.03.2025 passed by the Commissioner of Income Tax (Appeals- 5) Mumbai, relating to the Assessment Year 2010-11. 2. The assessee has raised the following grounds of appeal:
1. The learned CIT(A) has erred in confirming the disallowance made by learned AO of Rs.8,74,889/- being sales tax paid under protest and debited to P & L in the year under consideration i.e A.Y 2010- 11 which pertains to 2001-02.
Symphony Limited Vs. DCIT Asst. Year : 2010-11 - 2– 3. At the outset, the Ld. AR submitted that the assessee has not claimed this amount anytime in earlier year and has been paid and debited during the year as the amount has been crystalized. The Ld. DR on the other hand, argued that the amount should have been claimed in the year to which it pertains to, i.e. AY 2001-02. Since the amount has not been claimed and has been claimed and paid to Sales Tax Dept., we see no reason to disallow this expense.
In the result, the appeal of the assessee is allowed.
The order is pronounced in the open Court on 09.07.2025 Sd/- Sd/- (SUCHITRA KAMBLE) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT (True Copy) Ahmedabad; Dated 09.07.2025 MV आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, True Copy