TMI Blog2008 (5) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... e it clear that Explanation 2 is retrospectively applicable - 44 of 2007 - - - Dated:- 12-5-2008 - PRAFULLA C. PANT and DHARAM VEER JJ. Arvind Vashisth for the appellant. S. K. Posti for the respondent. JUDGMENT The judgment of the court was delivered by PRAFULLA C. PANT J. - This appeal, preferred under section 260A of the Income-tax Act, 1961, by the Revenue, is directed against the order dated April 7, 2006, passed by the Income-tax Appellate Tribunal, Delhi Bench "A", Delhi (hereinafter referred as "the ITAT"), in Income-tax Appeal No. 3506/Del/2003, relating to the assessment year 1998-99, whereby the appeal of the respondent/assessee, was partly allowed. 2. Heard learned counsel for the parties. 3. Brief ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, the Tribunal has allegedly erred in law in treating it deleted for the purposes of assessment, made for the assessment year 1998-99. 4. The substantial question of law involved in this appeal is as under: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal has erred in law in deleting the addition of Rs. 2,98,924 on account of breach of section 43B of the Income-tax Act, 1961, in spite of the fact that the amendment brought in the said section, vide the Finance Act, 2003, had expressly no retrospective implementation?" 5. Before further discussion, we think it just and proper to mention here, the relevant provision of law applicable to the case. Clause (b) of section 43B of the Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h, the object of the aforementioned proviso contained in the section is clear that any sum relating to provident fund which is deducted by the employer/assessee from salary of its employees and deposited in the Government account cannot form part of the taxable income of the assessee for the purposes of taxing the same, and the deduction in respect of such deposits made in the Government account is allowable. When section 43B was incorporated in the Income-tax Act, 1961, and contained the aforementioned second proviso, the intention of the Legislature appears to be that the deduction should be given only if the deposits are made within due dates under the enactment under which the same were realised from employees and required to be deposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, Mr. S. K. Posti, learned counsel for the respondent/assessee, contended that the amendment by which the second proviso to section 43B was deleted is curative in nature, and being explanatory has a retrospective effect. In support of his contention, learned counsel for the respondent/assessee drew attention of this court to the case of Allied Motors P. Ltd. v. CIT [1997] 224 ITR 677 (SC), in which the three judges-Bench of the apex court having considered views of various High Courts on a similar issue relating to deduction of deposits of sales tax under clause (a) of section 43B and Explanation 2 to the said section, has held that the first proviso to section 43B and Explanation 2 if read together make it clear that Explanation 2 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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