INCOME TAX QUERY...aà......

Section 43B of the Income Tax Act, 1961, applies to specific business expenses that are allowed as deductions only when they are actually paid.

Regarding your specific query about TDS and TCS payable:

Are TDS and TCS covered under Section 43B?

No. TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) are not considered "expenses" of the business.

The Logic: TDS/TCS is a tax deducted or collected by the assessee on behalf of the government from a third party (the deductee or collectee). It is not an expenditure incurred by the business for which a deduction is claimed under the head "Profits and Gains of Business or Profession" (PGBP).
Conclusion: Because TDS and TCS are not business expenses, they fall outside the scope of Section 43B. Therefore, the non-payment of TDS or TCS liabilities does not attract disallowance under Section 43B.

Summary of Section 43B Applicability

While TDS and TCS are excluded, Section 43B does apply to the following statutory and business liabilities, which are only deductible if paid by the due date of filing the Income Tax Return (ITR):

Item Covered Under 43B	Note
Statutory Dues	Any tax, duty, cess, or fee (e.g., GST) payable under any law.
Employee Welfare Funds	Contributions to Provident Fund (PF), ESI, or other recognized funds.
Bonus/Commission	Payable to employees.
Interest	On loans/advances from Public Financial Institutions, State Financial Corporations, or Scheduled Banks.
Leave Encashment	Payable to employees.
Payments to Railways	For the use of railway assets.
MSME Payments	Sums payable to micro or small enterprises (subject to specific MSMED Act timelines).

Key Takeaway: If you fail to pay these items by the due date of filing your ITR, the entire amount is disallowed as an expense for that financial year, and you can only claim the deduction in the year in which the actual payment is made.