The Tax Publishers2020 TaxPub(DT) 4898 (Mad-HC)

INCOME TAX ACT, 1961

Section 43B

Deduction for leave encashment is allowed only on actual payment.

Business disallowance under section 43B - Deduction only on actual payment - Provision for leave encashment -

Issue under consideration was whether Tribunal was justified in holding that the assessee-company was not eligible to claim provision for leave encashment on the ground that deduction for leave encashment would be allowable only on actual payment. Held: It is settled that deduction for leave encashment is allowed only on actual payment. Therefore, the Tribunal was justified in holding that the assessee-company was not eligible to claim provision for leave encashment on the ground that deduction for leave encashment would be allowable only on actual payment.

REFERRED : UOI & Ors. v. Exide Industries Ltd. & Anr. (2020) 107 CCH 0427 ISCC : 2020 TaxPub(DT) 1707 (SC) M/s. Dhanalakshmi Bank Ltd. v. CIT (2019) 109 taxmann.com 89 (SC) : 2019 TaxPub(DT) 8249 (SC) The South Indian Bank Ltd. v. CIT (2014) 49 taxmann.com 100 (Kerala) : 2014 TaxPub(DT) 1527 (Ker-HC).

FAVOUR : Against the assessee

A.Y. : 2004-05



IN THE MADRAS HIGH COURT

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