2019 (7) TMI 1255 - HC - Income Tax

Disallowance of deduction u/s.36(1) (va) r.w.s. 2(24)(x) - HELD THAT - The question of law proposed in the present appeal is squarely covered by the DECO MICA LIMITED VERSUS DEPUTY COMMISSIONER OF INCOME TAX 2018 (10) TMI 1696 - GUJARAT HIGH COURT . In such circumstances referred to above, this appeal, at this stage, is dismissed. However, if the Supreme Court reverses the judgement in the case of CIT vs. GSRTC 2014 (1) TMI 502 - GUJARAT HIGH COURT it would be open for the appellant to revive this appeal by filing an application for such purpose within three months from the date of the judgement. Appeal stands disposed of accordingly.

Summary

Issues Involved:
1. Disallowance of deduction u/s.36(1) (va) r.w.s. 2(24)(x) to the extent of ? 21,23,948/-

Analysis:
The High Court of Gujarat delivered a judgment on a Tax Appeal under Section 260-A of the Income Tax Act, 1961. The appeal was filed by the Assessee against the order passed by the Income Tax Appellate Tribunal for the Assessment Year 2013-14. The primary question of law proposed in the appeal was whether the Appellate Tribunal had substantially erred in upholding the disallowance of deduction u/s.36(1) (va) r.w.s. 2(24)(x) to the extent of ? 21,23,948/-. The learned counsel for the appellant referred to a previous order passed by the coordinate Bench in a different case, where a similar issue regarding the deductibility of employees' contribution towards Provident Fund, ESI, etc., was discussed. The Tribunal in that case dismissed the ground for deduction, which led to an appeal. The counsel acknowledged that the issue in the present appeal was covered by the previous judgment. Consequently, the High Court dismissed the present appeal at that stage, but left the option open for the appellant to revive the appeal if the Supreme Court reversed the judgment in the earlier case within three months from the date of the judgment.

This judgment highlights the importance of legal precedent and the impact of previous decisions on current cases. It also demonstrates the procedural aspect of dismissing an appeal while providing the appellant with an opportunity to revive the appeal based on the outcome of a related case before the Supreme Court. The legal principles governing deduction under specific sections of the Income Tax Act were central to the analysis, emphasizing the need for consistency and compliance with statutory provisions. The judgment showcases the judicial approach of balancing legal interpretations with practical considerations, such as the cost-effectiveness of pursuing further appeals. Overall, it underscores the significance of legal clarity, adherence to precedents, and the procedural options available to parties in tax matters before higher courts.