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TMI Blog2005 (1) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year when he is relieved of such liability in respect of which he has claimed deduction in the earlier assessment year - application is rejected - - - - - Dated:- 4-1-2005 - Judge(s) : RAJESH BALIA., DINESH MAHESHWARI. JUDGMENT This is an application under section 256(2) of the Income-tax Act, 1961, seeking a direction to the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, to state the case and to refer the following questions alleged to be questions arising from the appellate order of the Tribunal, dated March 22, 1994, which relates to the assessment year 1987-88: "1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in holding that the 'issue price' charged by the Excise Department does not come in purview of payment within the meaning of section 43B of the Income-tax Act and consequently cannot be disallowed under section 43B? 2. If the answer to question No. 1 is in the negative, whether the Income-tax Appellate Tribunal is justified in holding that the sum of Rs. 2,39,527 is allowable as a deduction in spite of the fact that the assessee has not accepted this amount as liability and contesting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any error in rejecting the application under section 256(1) on the ground that no question of law arises out of its order because the answer to the question raised is so obvious that it does not call for consideration by this court. Section 43B has been inserted by the Finance Act, 1983 (11 of 1983), section 18 (with effect from April 1, 1984). The provision was amended for the first time by the Direct Tax Laws (Amendment) Act, 1987, with effect from April 1, 1989. Since the matter concerns the assessment year 1987-88, section 43B as it was in force in 1987, would only govern this case. The provision at the relevant time read as under: "43B. Notwithstanding anything contained in any other provision of this Act, a deduction otherwise allowable under this Act in respect of- (a) any sum payable by the assessee by way of tax or duty under any law for the time being in force, or (b) any sum payable by the assessee as an employer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the welfare of employees, or shall be allowed (irrespective of the previous year in which the liability to pay such sum was incurred by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t specie, but such sums are the price paid by the licensee to acquire an exclusive privilege of the State to trade in liquor or other intoxicants. After referring to a number of decisions, the court came to the following conclusion: "It would be pertinent to note that the expression now used in section 43B(a) is 'tax, duty, cess or fee, or by whatever name called'. It denotes that items enumerated constitute species of the same genus and the expression 'by whatever name called' which follows preceding words 'tax', 'duty', 'cess' or 'fee' has been used ejusdem generis to confine the application of the provisions not on the basis of mere nomenclature, but notwithstanding the name, they must fall within the genus 'taxation' to which the expression 'tax', 'duty', 'cess' or 'fee' as a group of its specie belong, viz., compulsory exaction in the exercise of State's power of taxation where levy and collection is duly authorised by law as distinct from an amount chargeable on principle as consideration payable under a contract .... The 'tax', 'duty', 'cess' or 'fee' constituting a class, denotes various kinds of imposts by the State in its sovereign power of taxation to raise revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for human consumption including the manufacture, storage, export, import or possession or sale as an essential part of its exclusive right to carry on trade or business in intoxicating liquors meant for human consumption." The court, referring to the position prior to amendment in the provision with effect from April 1, 1989, the period with which we are also concerned, held that: "Prior to clause (a) of section 43B was substituted by Finance Act, 1988, with effect from April 1, 1989, it read 'any sum payable by the assessee byway of tax or duty under any law for the time being in force.' For the assessment year 1988-89, with which this appeal is concerned, the unamended provisions governs the computation of taxable income. The provision has expressly included only two species of taxation, namely, 'tax' or 'duty' and has also not used the wider expression 'by whatever name called' so as to make applicable the provisions of section 43B(a) to the tax in generic sense to include within the expression all forms of imposts as defined under article 366(28) of the Constitution of India. It may be seen that under the substituted provisions, the Legislature has extended the operatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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