Law:

Section:

Section 43B of the Income-tax Act, 1961 - Business disallowance - Certain deductions to be allowed only on actual payment - Whether in view of in CIT v. Sri Balaji & Co. [2001] 114 Taxman 682 /[2000] 246 ITR 750, kist amount payable by assessee to State Government which had not been actually paid, could not be disallowed - Held, yes CASE REFERRED TO CIT v. Sri Balaji & Co. [2000] 246 ITR 750 /[2001] 114 Taxman 682 (Kar.) [Para 2]. M.V. Seshachala for the Appellant. JUDGMENT G.C. Bharuka, J. - The question of law raised in the present appeal is : "Whether the Tribunal was correct in holding that the kist amount payable by the assessee to the State Government which has not been actually paid cannot be disallowed under section 43B of the Act in view of the judgment of this Hon'ble Court ?" 2. Sri M.V. Seshachala, learned standing counsel appearing for the appellants, fairly concedes that the issue raised in these appeals has been answered by a Division Bench of this Court in the case of CIT v. Sri Balaji & Co. [2000] 246 ITR 750 1, wherein it has been held that : "The provisions of section 17 of the Karnataka Excise Act, 1965, have referred to the power to grant lease of the right to manufacture. Section 24 has conferred the additional power on the State Government to accept payment of a sum or levy such licence fee or privilege fee as may be prescribed, in consideration of grant of lease or licence or both,…

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