Fact Check: Claim Of Govt Giving One Year Extension To Section 43B(H) Of I-T Related To MSME Payments Is False

New Delhi (Vishvas News) An image is going viral on the internet showing businessmen presenting a memorandum to Finance Minister Nirmala Sitharaman. The image was accompanied by claims that the government has decided to grant concessions under Section 43B(h) of the Income Tax Act for MSME payments. The claims suggest that the government has deferred the implementation of this new provision for one year, extending the payment period to 45 days. However, upon investigation, Vishvas News has found this claim to be false. There have been no alterations to this provision introduced under the Finance Act 2023.

What’s Going Viral?

While sharing the viral post, social media user ‘Darshan Singh’ wrote, “Meeting successfully concluded, Extension of one year giving relief to MSME traders. Section 43B (H) of Income Tax Act for MSME payment within 45 days has been extended for one year. Thank you Finance Minister for her support.”

Many other users have shared this picture with similar claims. One user sent this post to Vishvas News tipline number +91 95992 99372 and requested to find its truth.

Investigation:

Upon reverse image searching the picture featured in the viral post, a Times of India report dated January 10, 2024, was found, displaying the same image.

According to the report, “Textile traders from Surat met Finance Minister Nirmala Sitharaman in New Delhi on Friday to express concerns regarding the new payment provision recently added to the Income Tax Act. As per the new provision, buyers are required to settle payments within 45 days of purchasing from MSME units. Failure to comply will result in the amount being treated as profit for the buyer. This amendment came into effect at the beginning of the new financial year.”

However, there is no mention in any reports regarding the reversal of this change or an extension of the time. The government has also denied such claims. Government sources state that no modifications have been made to Section 43B(h) of the Income Tax Act about MSME payments.

FOSTTA (Federation of Surat Textile Traders Association) has also refuted the viral post, labelling it as a rumour. It has been reported that during their meeting with the Finance Minister, the FOSTTA delegation requested a one-year extension for MSME Section 43B(h), which the Finance Minister assured would be considered.

Vishvas News reached out to GST expert and founder of A2Z TaxCorp LLP, Bimal Jain, regarding the viral claim. He confirmed that no changes have been implemented in the new rules by the government.

According to news sources, the Central Government has enforced a new rule starting from the Assessment Year (AY) 2024-25, requiring buyers purchasing from MSMEs to settle payments within 45 days. Failure to do so will result in the payment amount being considered as income, subject to taxation by the government.

The content shared in the viral post stems from a particular ideology favoured by the user sharing it.

Conclusion: The image circulating on social media with claims that the government has extended Section 43B(h) of the Income Tax Act concerning MSME payments for one year, is false. This provision was enacted via the Finance Act 2023, and there have been no alterations made to it since its implementation.

Tags

• Business
• MSME