TMI Blog2022 (4) TMI 1420X X X X Extracts X X X X X X X X Extracts X X X X ..... e department has been allowing consistently. However, for the first time this disallowance has been done by CPC. We find this averment as correct. Therefore, applying the rule of consistency as per the decision of Hon ble Supreme court in the case of Radhasoami Satsang [ 1991 (11) TMI 2 - SUPREME COURT] when the facts permeating in the earlier years are same and there is no change in law and facts on an issue which the department has allowed, then the said issue should not be disturbed. Therefore, we allow the claim of the assessee in respect of the expenditure since no change in facts or law could be brought to our notice and direct deletion of the addition. Therefore, this ground of appeal of assessee is allowed. Disallowance made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wance of club expenditure of Rs.1,39,770/- claimed by the assessee in its return of income which has been processed by the CPC. 3. According to the Ld. AR Shri P. J. Bhide, the CPC while processing the return of income of the assessee u/s. 143(1)(a) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) has disallowed the club expenditure without issuing any notice which according to him, the CPC could not have done under proviso to section 143(1)(a) of the Act. According to him, the Ld. CIT(A) erred in confirming the disallowance on the ground that the auditor of the assessee in its audit report has flagged the same by stating to have been incurred for personal purpose. According to the Ld. AR, the expenditure has been incur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n column 21A of the Tax Audit Report in Form 3CD it was reported under the head personal expenditure (as per the prescribed format). The CPC it is noted is guided by the artificial intelligence which has picked up this particular disclosure in the Tax Audit Report and has taken it as gospel truth and has disallowed the same without notice to assessee. Be that as it may be, before us the Ld. AR of the assessee has brought to our notice that the assessee has incurred this expenditure for the purpose of business and since decades it has been incurring such kind of expenditure and the department has been allowing consistently. However, for the first time this disallowance has been done by CPC. We find this averment as correct. Therefore, appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dment brought in by Finance Act 2021 w.e.f. 01.04.2021 which inserted an Explanation to section 36(1)(va) and section 43B of the Act and erred in holding it as clarificatory and so, retrospective in nature. Whereas according to Ld.AR, it is only prospective in nature and cannot disturb the binding judicial precedents in favour of assessee. According to the Ld. AR, any way this issue is no longer res integra as held by this Tribunal in the case of Lumino Industries Ltd. vs. ACIT, Circle-5(1), Kolkata in I.T.A. No.365/Kol/2021 for AY 2015-16 order dated 17.11.2021, wherein assessee s favour view was taken by the Tribunal after holding that the amendment brought in by Finance Act, 2021 w.e.f 1.04.2021 is prospective in operation and so will be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l as Section 43B has been amended to this extend by inserting the Explanation 2 whereby it is clarified that the provision of Section 43B shall not apply and shall be deemed never to have been applied for the purpose of determining the due date under this clause. For ready reference, we reproduce the Explanation-2 to Section 36(1)(va) as under: Section 36(1)(va) Explanation-2 For the removal of doubts, it is hereby clarified that the provisions of Section 43B shall not apply and shall be deemed never to have been applied for the purpose of determining the due date under this clause 18. We find that this amendment has been brought in the Act to provide certainty about the applicability of Section 43B in respect of bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cordingly apply to Assessment Year 2021-22 and subsequent years. So since the legislative intent is clear, the amendment brought in by Finance Act, 2021 on this issue as discussed is prospective and Ld. CIT(A) erred in holding otherwise. So till AY 2021-22, the Jurisdictional High Court s view in favor of assessee will hold good and is binding on us. As discussed the decision of the Hon ble Delhi High Court in Bharat Hotels Ltd. (supra) which was in favor of revenue has not considered the decision of the Co-ordinate Division Bench decision in M/s Aimil Ltd.(supra) which is in favour of assessee. So we note that later decision of the Delhi/Hyderabad Tribunal have followed the decision favouring assessee in the light of the Hon ble Supreme Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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