12 December 2012
MY CLIENT HAD PAID TAXES I.E VAT AND SERVICE TAX ON 26TH SEPT BY CHEQUE, THE BANK HAVE PUT STAMP ON THE CHALLANS AS CHALLAN AND CHQ RECD ON 26/09 AND ANOTHER RUBBER STAMP ON 03/10 AS DATE OF REALISATION
THE ITO INTENDS TO DISALLOW THE EXPENDITURE ON THE GROUNDS OF SECTION 43 B WHICH SAYS THAT CERTAIN PAYMENT CAN BE DEDUCED ON ACTUAL PAYMENT.
MY QUERY IS WETHER THE EXPENDITURE IS ALLLOWABLE AS EXPENSES OR NOT
AS THE PAYMENTS WERE MADE BY THE CHQ AND CBDT CIRCULAR 261 DT 8/8/1979 SPECIFY THAT PRESENTATION OF THE CHEQUE OR DRAFT TO THE BANK WILL BE THE DATE OF PAYMENT OF THE AMOUNT PROVIDED THE CHQ IS HONOURED.
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