TMI Blog2012 (5) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... due date of the employees contribution and the employers contribution, but the payment were made well before the due date for filing the return of income prescribed for the year under appeal – in favour of assessee. - INCOME TAX APPEAL No. - 480 of 2008 - - - Dated:- 12-3-2012 - Ashok Bhushan, Vinay Kumar Mathur, JJ. Petitioner Counsel :- A.N. Mahajan Heard learned standing counsel for the Income Tax Department and Shri Ashish Bansal appearing for the assessee. This income tax appeal has been filed against the judgment and order dated 11.1.2008 passed by Income Tax Appellate Tribunal in I.T.A. No.562/Luc/2007. The assessing officer by assessment order dated 16.11.2006 has disallowed the claim of late payment of PF, ESI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed by the assessee as payment towards the contribution in P.F.,E.S.I.C. and E.S.I. have been accepted. The department filed appeal before the Income Tax Appellate Tribunal which was dismissed by order dated 11.1.2008. This appeal has been filed by the department under Section 260-A of the Income Tax Act, 1961 against the order of the appellate tribunal. The learned counsel for the department submitted that the provisions of Section 43-B proviso, as was amended w.e.f. 1st April, 2004 by Finance Act, 2003 shall not come to the rescue of the assessee since amendment was not retrospective and the deposits were made by the assessee prior to 1st April 2004. He submits that the said benefit was not available to the assessee and Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t no deduction shall, in respect of any sum referred to in clause (b), be allowed unless such sum has actually been paid in cash or by issue of a cheque or draft or by any other mode on or before the due date as defined in the Explanation below clause (va) of sub-section (1) of section 36, and where such payment has been made otherwise than in cash, the sum has been realised within fifteen days from the due date." Learned Commissioner of Income Tax recorded a finding in paragraph 4.ii) which is to the following effect:- "4.ii) I have considered the submission of the AR and perused the assessment order. It is a fact that the assessee has paid the amounts on account of employers/ employee contribution and employees contribution in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amendments made w.e.f. 1st April 2004 shall not be retrospective is without any substance and the issue is fully covered by the Apex Court judgement in Commissioner of Income Tax vs Alom Extrusions Ltd. (Supra). The Apex Court in the aforesaid judgement repelling the submission of the department laid down following:- "We find no merit in these civil appeals filed by the Department for the following reasons: firstly, as stated above, Section 43-B [main section], which stood inserted by Finance Act, 1983, with effect from 1st April, 1984, expressly commences with a non-obstante clause, the underlying object being to disallow deductions claimed merely by making a Book entry based on Merchantile System of Accounting. At the same time, Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Act, 2003, which is made applicable by the Parliament only with effect from 1st April, 2004, would become curative in nature, hence, it would apply retrospectively with effect from 1st April, 1988. Secondly, it may be noted that, in the case of Allied Motors (P) Limited vs. Commissioner of Income Tax, reported in [1997] 224 I.T.R.677, the Scheme of Section 43-B of the Act came to be examined. In that case, the question which arose for determination was, whether sales tax collected by the assessee and paid after the end of the relevant previous year but within the time allowed under the relevant Sales Tax law should be disallowed under Section 43-B of the Act while computing the business income of the previous year? That was a case which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, retrospective in operation with effect from 1st April, 1988. It is important to note once again that, by Finance Act, 2003, not only the second proviso is deleted but even the first proviso is sought to be amended by bringing about an uniformity in tax, duty, cess and fee on the one hand vis-a-vis contributions to welfare funds of employee(s) on the other. This is one more reason why we hold that the Finance Act, 2003, is retrospective in operation. Moreover, the judgement in Allied Motors (P) Limited (supra) is delivered by a Bench of three learned Judges, which is binding on us. Accordingly, we hold that Finance Act, 2003, will operate retrospectively with effect from 1st April, 1988 [when the first proviso stood inserted]. Lastly, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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