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794 EXCISE LAW TIMES [ Vol. 372

tax paid by the appellant was debited to a separate account titled ‘Sales Tax re-
coverable account’. The assessee could have set off sales tax against his liability
on the sales of finished goods i.e. vehicles. We do not find any infirmity in the
view of the High Court answering the above question.
33. The next submission which has been advanced by Shri Ganesh is on
the first proviso to Section 43B. It has been submitted that Return for the assess-
ment year in question was to be filed before 30-9-1999 and unutilised credit in
fact was fully utilised by 30-4-1999 itself. It is submitted that since the unutilised
credit was utilised for payment of Excise Duty on the manufactured vehicles, the
said amount ought to have been allowed as permissible deduction under Section
43B.
34. The proviso to Section 43B provides that nothing contained in the
Section shall apply in relation to any sum which is actually paid by assessee on
or before due date applicable in his case for furnishing the return in respect of
the previous year in which the liability to pay such sum was incurred. The cru-
cial words in the proviso to Section 43B are “in respect of the previous year in
which the liability to pay such sum was incurred”. The proviso takes care of the
situation when liability to pay a sum has incurred but could not be paid in the
year in question and has been paid in the next financial year before the date of
submission of the Return. In the present case, there was no liability to adjust the
unutilised MODVAT credit in the year in question since had there been liability
to pay Excise Duty by the appellant on manufacture of vehicles, the unutilised
MODVAT credit could have been adjusted against the payment of such Excise
Duty. In the present case, the liability to pay Excise Duty of the assessee is in-
curred on the removal of finished goods in the subsequent year i.e. year begin-
ning from 1-4-1999 and what we are concerned with is unutilised MODVAT
Credit as on 31-3-1999 on which date the asseessee was not liable to pay any
more Excise Duty. Hence, present is not a case where appellant can claim benefit
of proviso to Section 43B. The submissions of Shri Ganesh on proviso to Section
43B also does not support his claim.
35. In view of the foregoing discussions, we are of the view that High
Court has correctly answered both the questions against the assessee-appellant
and in favour of the Revenue. Consequently, the appeals are dismissed.
_______

2020 (372) E.L.T. 794 (Bom.)
IN THE HIGH COURT OF JUDICATURE AT BOMBAY

Ranjit More and Bharati H. Dangre, JJ.
SANDEEP PATIL
Versus
UNION OF INDIA
Crim. Public Interest Litigation St. No. 3 of 2019, decided on 6-2-2019
Duty free shops - Sale of tobacco products at International Airports -
Duty free shops at International airports deemed to be outside India or beyond
the geographical area-territory of India and therefore for all purposes they are
treated to be outside India - Goods sold or supplied from duty free shops at
EXCISE LAW TIMES  15th June 2020  116