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TMI Blog2006 (11) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... v. CIT [2000] 245 ITR 428, where the apex court held that such a liability on account of leave encashment was a liability in praesenti although it might be discharged at a later date and as such the assessee was entitled to claim appropriate deduction by debiting its profit and loss account and making a corresponding credit entry in the liability account. Soon after the judgment was delivered by the apex court the assessee applied for revision before the Commissioner within the statutory period of limitation. The Commissioner dismissed the revisional application by holding that the judgment in the case of Bharat Earth Movers [2000] 245 ITR 428 was squarely applicable in the case of the assessee. However, he was not inclined to extend such b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner, however, felt that such benefit of the judgment in Kedarnath Jute Manufacturing's case [1971] 82 ITR 363 (SC) could only be availed of by the assessee had the Bharat Earth Movers's case [2000] 245 ITR 428 (SC) decision been pronounced before the assessment was complete. Being aggrieved by and dissatisfied with the decision of the Commissioner dated July 13, 2001, appearing at pages 34-36 of the paper book the appellant-assessee filed a writ petition before this court. The learned single judge dismissed the writ petition by the judgment and order under appeal. His Lordship was of the view that the benefit of the judgment in the case of Bharat Earth [2000] 245 ITR 428 (SC) could not be extended to the appellant as it would amount to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claiming deduction under the proper head on the basis of the decision of Bharat Earth [2000] 245 ITR 428 (SC). Mr. Lahiri further contends that the Commissioner was wrong in holding that the decision of Bharat Earth [2000] 245 ITR 428 (SC) could not be given retrospective effect since the assessment was complete before such judgment was delivered. In support of his contention, Mr. Lahiri has relied upon the apex court decision reported in Dr. Suresh Chandra Verma v. Chancellor, Nagpur University, AIR 1990 SC 2023. Paragraph 9 of the said decision was relied upon which is quoted below: "The second contention need not detain us long. It is based primarily on the provisions of section 57(5) of the Act. The contention is that since the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not necessary to hear the individuals before their services are terminated. The rule of audi alteram partem does not apply in such cases and, therefore, there is no breach of the principles of natural justice. In the result we are of the view that there is no merit in this case. The appeal, therefore, stands dismissed. In the circumstances of the case, however, there will be no order as to costs." Mr. Nizamuddin, learned counsel appearing on behalf of the Revenue, has relied upon paragraph 7 of the decision of the apex court in the case of Harsh Dhingra v. State of Haryana and Sant Kumar v. State of Haryana, AIR 2001 SC 3795 which is quoted below: "Prospective declaration of law is a device innovated by the Supreme Court to avoid reo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed as contingent liability and the assessee was entitled to get appropriate deduction by making a debit entry in their profit and loss account for the said amount and by making a corresponding credit entry in the liability account. We are in full agreement with the Commissioner that the decisions of the apex court in the case of Bharat Earth [2000] 245 ITR 428 as well as Kedarnath Jute Mfg. Co. [1971] 82 ITR 363 were squarely applicable in the instant case. We are, however, unable to appreciate the view of the learned judge that it would amount to a double benefit to the assessee. The only question that remains to be decided is whether the assessee-appellant was entitled to the benefit of the aforesaid two decisions for the particular ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing procedure prevalent on that day. The decision was given by the Assessing Officer on that return in accordance with law as prevalent on that date. It might be true that by coincidence the application for revision was made within the statutory period of limitation after the decision of Bharat Earth's case [2000] 245 ITR 428 (SC). We are of the view that such decision could have been made applicable in the instant case had there been a dispute pending with regard to the assessment as on the date of delivery of the judgment meaning thereby in case such revisional application was pending as on the date of delivery of the apex court decision the same could have been made applicable. The Commissioner rightly decided the issue and we do not f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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