COMMISSIONER OF INCOMETAX Vs. CENTRAL INDIA MOTORS

JUDGEMENT

(1.) AT the instance of the Revenue, the Tribunal has stated the case and referred the under-noted question of law under S. 256(1) of the IT Act, 1961 ('the Act') arising out of the order dt. 25th Aug., 1993 passed by the Tribunal in IT Appeal No. 635 (Indore) of 1989 for our answer:

(2.) FACTS lie in narrow compass. The Revenue Authorities made a deduction of Rs. 2,37,218 by invoking the provisions of S. 43B of the aforesaid Act. The said amount represents the outstanding credit balance in the sales tax account and the employees contribution to provident fund. The Tribunal had directed the AO to examine the component of the said amount and to allow deduction of such amount of sales tax which was paid before the due date prescribed under S. 139(1) of the Act for submission of the return of income for the assessment year in question. The Tribunal held that the proviso was declaratory in nature and was, thus, retrospective in operation. Aggrieved, the Revenue filed the application under S. 256(1). On this application, the Tribunal stated the case and referred the aforesaid question.

(3.) WE notice that the Tribunal took the view that although the proviso was inserted w.e.f. 1st April, 1988, it was a declaratory in nature and as such, was applicable retrospectively. The remedial statute should receive a literal construction.