Section 23(1) — the law in short
What the courts have decided on section 23(1), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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CIT v Dalhousie Properties Ltd
Supreme CourtHelps taxpayerSuperseded by amendment
The municipal taxes on my client's let-out property have been levied and are under dispute before the Corporation, and only part has been paid. Can I still deduct the whole amount, relying on Dalhousie Properties?
Not any more. The Supreme Court did hold, on the proviso to s.23(1) as it stood for assessment year 1966-67, that the words 'borne by the owner' referred to the liability the owner had to discharge and not to the sum actually paid, so that neither non-payment nor a dispute before the local authority defeated the deduction. That proviso has since been replaced: the proviso now in force allows the deduction only in the previous year in which the taxes are actually paid by the owner, and the Court in this very judgment noted that the proviso as it then stood had not been happily worded and had since been suitably modified.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.