No deduction allowed U/s. 43B of amount standing in ‘Sales-tax Recoverable A/c‟

Maruti Udyog Ltd. Vs. CIT (Delhi High Court) Issue: Whether the ITAT has committed an error of law in upholding the dis allowance of Rs. 3,08,79,171 in respect of Sales Tax Recoverable account, under Section 43B of the Income Tax Act? Held by Delhi High Court The treatment of advance payment of sales tax, as far as Section 43B, is concerned is no different from the treatment of MODVAT credit under the excise law. It is not in dispute, therefore, that in principle the answer to question (ii) will govern question (iii) as well. The facts are the Assessee pays sales-tax on the purchase of raw mat...