TMI Blog2004 (1) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 (the Act), seeking to rectify summary assessment made under section 143(1)(a) of the Act for the assessment years 1990-91, 1992-93, 1993-94 and 1994-95. In the writ petition, the assessment for the year 1995-96 under section 143(1)(a) of the Act was also challenged. The petitioner had claimed allowable deduction in respect of the contingency reserve fund in the respective returns. Up to the assessment year 1994-95, the returns were accepted, allowing deduction in respect of the appropriation to contingency reserve fund and intimation under section 143(1)(a) was issued. Subsequently, notice under section 143(2) was issued. Regular assessment under section 143(3) was completed disallowing the appropriation to contingency reserve for the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t made under section 143(1)(a) of the Act in respect of the assessment year 1995-96 since intimated under section 143(1)(a) on March 18, 1996. Admittedly, this appropriation to contingency fund was disallowed in view of the decision in Associated Power Co. Ltd. v. CIT [1996] 218 ITR 195 (SC). The main contention of Dr. Debiprosad Pal, senior counsel, appearing on behalf of the appellants, was that the assessment is to be made on the basis of the law applicable on the date of filing the return. In the assessment intimated under section 143(1)(a) while disallowing the appropriation to contingency reserve, the Assessing Officer had made an addition under section 143(1)(a), which is penal in nature and cannot be imposed when the return at the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elied on Associated Power Co. Ltd. v. CIT [1996] 218 ITR 195 (SC) and CIT v. Hindustan Electro Graphites Ltd. [2000] 243 ITR 48 (SC) and contended that Hindustan Electro Graphites Ltd. [2000] 243 ITR 48 (SC) deals with section 143(1A) as well. The question of maintainability was gone into by the learned single judge. The learned single judge was pleased to observe that the writ was maintainable since the notices involved the question of jurisdiction. The maintainability was considered in respect of the other four assessment years where notices under section 154 were issued and the jurisdiction to issue such notices was involved. No such notice, however, was issued in respect of the assessment year 1995-96. However, the question of maintai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me Court shall be binding on all courts. The declaration of law is complete as soon as the judgment is pronounced. Immediately with the declaration of law the principles of article 141 are activated. The binding force of the law declared is not dependent on the publication in any report or on the knowledge or information of any individual assessee. Therefore, the disallowance of deduction of appropriation to contingency reserve in respect of the return submitted after the decision in Associated Power Co. Ltd. [1996] 218 ITR 195 (SC) cannot be said to be without jurisdiction to maintain the writ petition. At the same time, it was not a question of addition under section 143(1)(a) of a tax in the nature of penalty. In fact, this appropriati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to contingency fund was accepted as allowable deduction in earlier years. With due respect, we are unable to agree with the principle sought to be enunciated by Dr. Pal relying on this decision. That apart the acceptance of deduction of appropriation to contingency reserve for the earlier years has since been reversed in the subsequent regular assessment under section 143(3) in respect of two assessment years while in respect of the other two assessment years it was pending. These facts make the present case distinguishable from the facts of the case cited. Reliance on the decision in Vijay Mallya v. Asst. CIT [2003] 263 ITR 41 (Cal) disposed of on May 12, 2003, by this Bench does not seem to be of any assistance since the said decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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