TMI Blog2006 (9) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... of the case are as follows : For the assessment year 2001-02, the due date for filing of return under section 139(1) of the Income-tax Act, 1961 was 31-10-2001. The assessee paid all the contributions before 25-10-2001. These facts are recorded in the assessment order, which are not disputed by the revenue. The only issue that arises for consideration is whether the contributions paid by the assessee before the due date for filing of the return under section 139(1), could be allowed under the Income-tax Act? 3. Shri N.R. Siva Swamy, learned representative for the assessee, submitted that the Supreme Court in the case of Allied Motors (P.) Ltd. v. CIT [1997] 224 ITR 677 1 , considered the first proviso to section 43B and held that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with effect from 1-4-2004, is applicable prospectively. According to the learned representative, the amended provisions of section 43B are not applicable to this assessment year, and the lower authorities have rightly disallowed the claim of the assessee in respect of the payments made beyond the due dates provided under the respective enactments. 5. We have considered rival submissions on either side and perused the materials available on record. The only issue that arises for consideration is whether the payments made by the assessee towards Provident Fund and ESI within the due date for filing of return under section 139(1) of the Income-tax Act are allowable as deduction or not? We have carefully gone through the second proviso to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use ( va ) of sub-section (1) of section 36. Ultimately, the High Court concluded that provisos 1 and 2 and Explanation under clause ( va ) of sub-section (1) of section 36 are not violative of Article 14 of the Constitution of India. Therefore, it is obvious that the High Court had no occasion to consider the provisions of the Finance Act, 2003, which was introduced with effect from 1-4-2004. The High Court merely upheld the constitutional validity of the first and second provisos to section 43B and Explanation under clause ( va ) of sub-section (1) of section 36 by holding that the classification made by the Legislature in the first and second provisos does not violate Article 14 of the Constitution of India. 6. The question befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rst proviso and the entire clauses of section 43B were brought under the first proviso to section 43B. Since the Apex Court held that the first proviso to section 43B was retrospective in operation in relation to clause ( a ), the very same first proviso cannot be said to be prospective in respect of a part of the clauses of section 43B. As observed by the Special Bench, when the first proviso to section 43B operates retrospectively with regard to clause ( a ) of section 43B, we cannot say that the very same first proviso would be prospective in operation with regard to clause ( b ). In other words, no one could say that part of the first proviso would have retrospective operation and the other part of the same proviso would have prospectiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so. Therefore, in our opinion, the judgment of the Andhra Pradesh High Court in the case of Hitech India (P.) Ltd. ( supra ) may not be applicable to the facts of this case. Since the Apex Court in the case of Allied Motors (P.) Ltd. ( supra ) held that the first proviso to section 43B was retrospective in operation, in our opinion, the entire first proviso as amended by Finance Act, 2003, with effect from 1-4-2004 would have retrospective operation. The intention of the Legislature is to amend the provisions of section 43B in tune with the law laid down by the Apex Court in the case of Allied Motors (P.) Ltd. ( supra ). Otherwise, there is no need for omitting the second proviso, or incorporating the entire clauses including clause ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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