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Question ID : 40456

Deduction of Indirect Taxes Paid

A company has wrongly availed Input Tax Credit under erstwhile CENVAT Rules in 2015-16. During GST Audit in current year, this was found out and the company paid the wrong credit availed in earlier years as above now, i.e. in FY 2019-20. The same has been expensed off. Is it an allowable expenses under Income Tax Act? Please provide any case laws, if available.

Posted by balasubramanian on Nov 06, 2019


Answer ID : 80220

Excess claim of credit means increase in profit. Reclaiming the same as expenses doesn't suffice the purpose. Better you should adjusted in PL appropriation account.

Posted by SURAJ KUMAR CHOUDHURY on Nov 09, 2019