Case Law Details
Background
The Mumbai Tribunal has recently held in the case of Schenectady Specialities Asia Pvt. Ltd. that the difference between the sales tax collected but not deposited by the assessee with the Government under a sales tax deferral scheme, and the amount settled by the assessee under the premature payment option, is to be treated as income of the assessee, for the assessment year in which such sales tax liability is discharged.
Facts
The assessee is a company and has set up its unit in Raigad District, which is a notified backward area and is thus eligible for incentives as per schemes announced by the State Government of Maharashtra. The incentives were inter alia, in the form of deferment of payment of sales tax in terms of the Package Scheme of Incentives, 1993.
In terms of this Scheme, the sales tax liability of the assessee upto the end of financial year 1999-2000, aggregating to Rs. 1,79,68,846, was required to be paid by the assessee in five equal annual installments from April 2010 onwards.
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