Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2022 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (9) TMI 306 - HC - Income TaxApplicability of Section 43B - electricity duty collected by the assessee as per the provisions of Punjab Electricity (Duty) Act, 1958 - revenue claims that since the assessee in the present case was following mercantile system of the accounting, thus provision of Section 43B will be applicable to the amounts covered under electricity duty - whether the amount towards electricity duty is payable by the assessee or it is merely a collection agency discharging its duty under a statutory arrangement? - HELD THAT:- Liability to pay electricity duty lies on the consumer. Further, the electricity duty is to be paid to the State Government. Section 4 casts duty on the licensee to collect the electricity duty from the consumers and to pay the same to the State Government. Licensee is only a collecting agency. It will be further apposite to notice here that exercising powers under Section 13 of the 1958 Act, rules have been framed. The rules called as Punjab Electricity (Duty) Rules, 1958 prescribes for collection and payment of duty. Thus, the amount collected by the licensee as electricity duty leviable under 1958 Act is required to be deposited in the Government treasury by the licensee. Section 43B is a non-obstente clause. As inserted by Finance Act, 1983 with an intent to curb the malpractice at the hands of certain tax payers, who claimed statutory liability as a deduction without discharging the same and pleaded mercantile system of accounting as defence. The argument raised by counsel for the appellant(s) that Section 43B will be attracted merely for the reason that the appellant(s) is following mercantile system of accounting deserves to be rejected. The revenue is required to show that the duty, tax, cess or fee (in the present case electricity duty) is payable by the assessee. The reliance placed on judgment passed by Gujarat High Court in Ahmedabad Electricity Co. Ltd.'s case [2003 (1) TMI 43 - GUJARAT HIGH COURT] is misplaced. Rather Section 4 of the 1958 Act read with provisions contained in 1958 Rules makes it abundantly clear that assessee is merely an agency assigned with a statutory function to collect electricity duty from the consumers and to pay the same to the State Government - we find that the question w.r.t. the applicability of Section 43B on the electricity duty, needs to be answered against the revenue and in favour of the assessee.
|