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1assessee has debited an amount of Rs. 19,37,936 under the head"General and Administrative Expenses". Ithas been paid to the landlord towards reimbursement of property tax to be paid by the landlord/licensor on the property taken on lease by the assessee. Referring to the provisions of s. 43B(a) of the Act, the AO observed that tax, duty, cess or fee, if any, claimed by the assessee can be allowed as a deduction only on actual payment. He observed, since the amount in question has not been actually paid during the year, it has to be disallowed and added back to the income of the assessee. As could be seen from the aforesaid terms of the agreement, the reimbursement of property tax by the assessee to the licensor is purely contractual and not a statutory liabilityThat being the case, the amount equivalent to the property tax reimbursed to the licensor cannot be treated as rate, tax, fee, cess, etc., as provided under s. 43B(a) of the Act. Therefore, the disallowance made of Rs. 19,37,936 has to be deleted. Accordingly, we do so. Ground is allowed.

Shanti Prime Publication Pvt. Ltd.

Sec. 43B, 143(3) & 144C(13) of Income-tax Act, 1961—Business Disallowance— Assessee filed appeal in delay of 124 days  Seeking condonation of delay, the assessee has filed an application accompanied by affidavit. In the view of tribunal that the delay in filing the present appeal is due to bona fide reasons. Therefore, condoning the delay and admit the appeal for adjudication.  In the course of assessment proceedings the AO while verifying the P&L a/c noticed that the assessee has debited a sum under the head "General and Administrative Expenses". After calling for necessary details and examining them, he found that the amount represents property tax payable to the Municipal Authority through the landlord as per the terms of the leave and license agreement. The assessee claimed the expenditure on estimate basis. Assessing officer disallowed the claim and added back to the income of the assessee. Against the aforesaid addition, the assessee raised objections before DRP. However, the addition mad by the AO was upheld. Assessee filed appeal before tribunal.  Tribunal held that  the aforesaid terms of the agreement, the reimbursement of property tax by the assessee to the licensor is purely contractual and not a statutory liability, Thus,  the amount equivalent to the property tax reimbursed to the licensor cannot be treated as rate, tax, fee, cess, etc., as provided under s. 43B(a) of the Act. Therefore, the tribunal delated the disallowance accordingly, thus athe appeal was partly allowed. ---  AREVA INDIA (P) LTD. vs. Asstt. CIT. [2020] 23 ITCD Online 142 (MUM)