TMI Blog2000 (9) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Finance Act, 1990, clause (iiib) was inserted in section 28 of the Income-tax Act, 1961, with retrospective effect from April 1, 1967. According to section 28(iiib), cash compensatory support became chargeable to income-tax under the head "Profits and gains of business". The return filed by the assessee was processed under section 143(1)(a) of the Act and an intimation under section 143(1)(a) of the Act dated July 23, 1990, was issued to the assessee. In this intimation, the Assessing Officer had made prima facie adjustment in respect of the cash compensatory support of Rs. 10,98,368 and this amount was brought to tax. On the basis of this addition, additional tax and interest under section 234B was also charged. The assessee on rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t case the Tribunal had held that no additional tax can be levied nor interest under section 234B can be charged. While cancelling the levy of additional tax and the interest charged under section 234B in connection with the addition made on account of cash compensatory support, the Tribunal had observed as under: 'We have heard learned counsel for the assessee and learned standing counsel for the Department at length. It is crystal clear that there was no mistake of the assessee in filing the return of income as on the date it was filed. The assessee was further supported by the order of the Special Bench of the Tribunal in the case of Gedore Tools (India) Pvt. Ltd. v. IAC. It cannot, therefore, be said that there was a lack of bona fide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. From the judgment of the Tribunal extracted above, it is apparent that the Tribunal formed its opinion on the basis of its earlier judgment in the case of Hindustan Electrographite Ltd. The view taken by the Tribunal in the case of Hindustan Electrographite Ltd. came up for consideration before a Division Bench of this court on a reference under section 256(1) of the Income-tax Act, in the case of CIT v. Hindustan Electrographite Ltd. [1998] 229 ITR 16. In the said case it has been held as follows: "In the present case, as we have already pointed out above, at the time when the assessee filed the return, the Finance Act of 1990, had not come into being, much less making it to be retrospective with effect from April 1, 1967. Section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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