Explanation 3D to s.43B

Explanation 3D to s.43B — the law in short

What the courts have decided on section Explanation 3D to s.43B, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Frontier Information Tech Ltd v DCIT High CourtHelps taxpayerNo later treatment found
  My lender took equity shares against the outstanding interest. The Assessing Officer says there was no actual payment under section 43B. Is he right?
  No. Where the liability to pay interest ceases to exist because shares have been issued to the lender, that is actual payment within section 43B, and Explanations 3C and 3D have nothing to bite on. The test the High Court applied is whether the liability to pay the interest stands extinguished.

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.