9911796707
TMI Blog2005 (4) TMI 531X X X X Extracts X X X X X X X X Extracts X X X X ..... income of Rs. 13,50,143. The return was processed under section 143(1)(a) on 27-12-1995 raising a demand of Rs. 1,48,758. The said order was rectified under section 154 dated 24-4-1996 by modifying the deduction under section 80HHC resulting in a refund of Rs. 4,51,190. The assessment has completed under section 143(3) determining an income of Rs. 14,16,907 on 25-11-1997. During the course of the assessment, the assessee has claimed a payment of Rs. 1,95,094.65 under section 40A(7) read with section 43B in respect of payment to LIC towards an approved gratuity fund and same was allowed as a deduction. The Assessing Officer issued notice under section 154 dated 23-2-1999 proposing to disallow a sum of Rs. 1,95,094.65 being the payment made t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2003 has deleted the second proviso and amended the first proviso to section 43B with effect from assessment year 2004-05. The amendment has an effect of deleting the specified clauses as mentioned in the first proviso. It also has the effect of bringing existing clause (b) at par in terms of allowability of expenses. As per the amended provisions of section 43B, the payments made by the employer towards contribution to PF, ESI, gratuity, superannuating and other welfare funds are allowable if the same are paid before filing the return of income and necessary evidence of such payment is enclosed with the return of income. In other words, no disallowance of such payment would be made even if the same are made beyond the due dates prescribed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and following the rule of equitable construction, the assessee would be eligible to deduction for all such payments made before the due date of filing of return. (Para 19)." Learned D.R., on the other hand strongly supported the order of learned CIT(A). 4. We have considered relevant facts and argument advanced. We are in total agreement with the submission made by learned counsel for assessee. Though clause (b) of section 43B includes payment by way of constitution to gratuity fund. Prior to amendment of section 43B with effect from 1-4- 2004, as per second proviso to section 43B, the amount paid by way of constitution to gratuity fund will be allowed only in the year of actual payment. However, as per amended proviso to section 43B if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion will be allowed only in the year in which it is actually paid. Thus exception carved out in section 40A(7)(b) and section 43B are mutually contradictory. In such a situation, exception carved out in section 40A(7)(b) being a provision of special nature dealing with provision made for payment of a sum by way of any contribution towards an approved gratuity fund etc., will prevail over the general provisions of section 43B(b) dealing with contribution to any gratuity fund. The rule of construction which is relevant to the present enquiry is expressed in the maxim, "generalia specialibus non derogant", which means that when there is a conflict between a general and a special provision, the latter shall prevail. The said principle has been ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
