Provision for unpaid excise duty

This query is : Resolved

CA. Mala Rohara (Querist)
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18 September 2012 Please advise we made provision for unpaid excise duty for goods lying at factory on 31st March, 2012. But this excise duty is not paid subsequently as goods exported. Please advise this provision will be disallowed under Income Tax act in section 43B because of non payment of excise duty.

Following entry was passed on 31/03/2012:

Excise Duty on finished goods Dr.
To Provision for unpaid excise duty

Closing Stock was valued inclusive of excise duty.

CA. Vikash Chandra Jaiswal

CA. Vikash Chandra Jaiswal (Expert)
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19 September 2012 The provision for unpaid excise duty will be disallowed under income tax since duty was not paid. Section 43B clearly specifies that payment of expenses must be made before the date of submission of return. Since the payment was not made provision would be disallowed.