43B- Query

 

Hi all

When expenses such as Duties/taxes/cess are not passed through the P &L Account. They are taken to Current Liabilities under exclusive method of accounting

. Is there a Question of Disallowance u/s 43B

 

Replies (4)

Hi santosh, 

 

I was also having the same doubt, but i came across 2 resources that clearly show that only if an expense is claimed as deduction in the profit and loss account, the same can be disallowed. Because of this, my view is changed in favour of assessee.

First file, gives you comprehensive details of 43B.

 

Attaching one more file below, which clarifies that the AO does not have the power to take recourse to the Balance Sheet of the assessee to disallow statutory payments - regarding 43B(a).

Find it on my second reply.. Hope its clarified.

Now, with this, Assessee WINS!

 

But please anyone having more recent case laws please contribute.

I do agree with Silent Monk & the same is very much logical as how there can be any diallowance without the clim of the same in the P& L.

Thanks,

Sunil.

I agree with silent Monk

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