2006 (6) TMI 71 - HC - Income Tax

Interpretation of clause (b) of section 43B of the Income-tax Act 1961 read with the second proviso to the said section and clause (va) of sub-section (1) of section 36 - matter relates to deposit of contributions made towards provident fund etc. after the close of the accounting period but before the due date for filling of the return of income and whether in such cases the assessees are entitled to relief under section 43B(b) - respondents pointed out that in the meantime the relevant proviso to section 43B(b) has been amended and the relevant words referred to in clauses (a) (c) (d) (e) or (f) have been omitted with effect from April 1 2004. - the effect of such omission without any saving clause of the General Clauses Act means that the above provisions were not existence or never existed - held that the contributions towards provident fund etc. paid before the filing of the return by the assessees are entitled for the deduction revenue appeal dismissed

Summary

Issues: Interpretation of section 43B of the Income-tax Act, 1961 regarding deposit of contributions made towards provident fund after the accounting period but before the due date for filling the return of income.

In this judgment by the High Court, the court addressed the interpretation of clause (b) of section 43B of the Income-tax Act, 1961, along with the second proviso to the said section and clause (va) of sub-section (1) of section 36 of the Act. The central issue revolved around whether assessees are entitled to relief under section 43B(b) for depositing contributions towards provident fund after the close of the accounting period but before the due date for filing the return of income. The court noted that a previous decision in the case of CIT v. Assam Tribune had held that such contributions made before the filing of the return are eligible for deduction, based on an earlier decision in the case of CIT v. Bharat Bamboo and Timber Suppliers. The appellants sought a review of this decision, citing a contradictory judgment from the Kerala High Court in the case of CIT v. South India Corporation Ltd. However, the respondents argued that the relevant proviso to section 43B(b) had been amended, leading to the omission of certain words, which, according to them, implied that the provisions were no longer in existence. They relied on various decisions, including those of the Constitution Bench of the apex court, to support their argument.

After considering the submissions and reviewing the earlier decisions of the court, the High Court declined to review the decisions in Bharat Bamboo and Assam Tribune. Consequently, the court held that the decisions in those cases would apply to the present appeals. As a result, the appeals were dismissed based on the aforementioned findings and interpretations of the relevant provisions of the Income-tax Act, 1961.