- (1.) THIS is an application under Section 256(2) of the IT Act, 1961, seeking a direction to the Tribunal, Jaipur Bench, Jaipur, to state the case and to refer following questions alleged to be question arising from the appellate order of the Tribunal, dt. 22nd March, 1994, which relates to the asst. yr. 1987 -88 : '1. Whether, on the facts and in the circumstances of the case, the Tribunal is justified in holding that the 'issue price' charged by the Excise Department does not come in purview of payment within the meaning of Section 43B of the IT Act and, consequently cannot be disallowed under Section 43B ? 2. If the answer to the question No. 1 is in the negative, whether the Tribunal is justified in holding that the sum of Rs. 2,39,527 is allowable as a deduction in spite of the fact that the assessee has not accepted this amount as liability and contesting the same ?'
(2.) THE assessee is a liquor contractor and was holding licence for wholesale and retail sale of country liquor under the licence. The assessee was required to pay Rs. 80,15,872 as 'issue price'. This amount was payable by the assessee in 12 monthly instalments. The assessee has claimed a rebate of Rs. 2,39,527 from his aforesaid obligation, inter alia, on the ground that for certain period, the liquor shops had to remain closed on account of curfew during that year. The assessee did not pay the aforesaid amount to the Excise Department chargeable from him as a part of price under the contract. It has claimed a deduction in respect of the aforesaid amount also, which has not actually been paid by him, but on the basis of accrued liability, in computation of his taxable income. The AO has considered the aforesaid amount payable under the licence as an amount of duty payable by way of a licence fees amounting to a tax and, therefore, not deductible unless actually paid in terms of Section 43B of the IT Act, 1961.
(3.) ON appeal, CIT(A) found that although the aforesaid amount was not payable as excise duty on manufacture of liquor, yet it was a tax and hence was covered by the provisions of Section 43B and upheld the disallowance by the ITO.;