Section 43(3) of the Income Tax Act
Income-tax Act, 2025: ss.39, 41
Section 43(3) falls under section 43 of the Income-tax Act, 1961, which corresponds to section 39 (Computation of actual cost) and section 41 (Written down value of depreciable asset) of the Income-tax Act, 2025.
Read section 39 of the 2025 ActRead section 41 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 43(3) is 33 ITR 182 (SC). (ii) Investment Ltd. v. CIT (167 Taxmann 256), cited in 33 of the 42 judgments on BharatTax that turn on this section.
Leading authorities on Section 43(3)
The Assessing Officer has the discretion to select an accounting method and the assessee cannot compel the department to adopt a particular method.
Expenditure not allowable under Section 36(1)(iv) of the Income Tax Act may still be allowable under Section 37 of the Act, even if the Tribunal followed this decision.
The Andhra Pradesh High Court in P.L. Ganapathi Rao & ANR vs. CIT (2006) 285 ITR 501 (AP) noted that a cash basis accounting system was followed in the case.
An upfront premium received for a concession or lease agreement, which is non-refundable even upon premature termination, is considered a revenue receipt for tax purposes.
An assessee is entitled to claim the balance 10% of additional depreciation in a subsequent assessment year, even before the insertion of specific provisos, if the machinery was put to use for less than 180 days in the first year.
An assessee is entitled to claim the remaining 10% of additional depreciation in a subsequent year.
Section 80P of the Income Tax Act is to be interpreted liberally to encourage the growth of the cooperative sector, rather than narrowly restricting its scope for exemptions.
