ITC LTD. Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The subject-matter of challenge in this appeal is a judgment and order dt. 28th Feb., 2003 by which the appeal preferred by the Revenue was allowed by the Tribunal holding that:

(2.) Mr. Khaitan, learned senior advocate, appearing for the assessee appellant submitted that it would appear even from the order of the AO that he referred to the adjudicatory orders in respect of the show-cause cum demand notices dt. 10th Oct., 1977, 29th Sept., 1980 and 5th Nov., 1980 passed on 12th Feb., 1982. He submitted that the aforesaid three several demands were disputed by the assessee and the matter was set at rest by the order of adjudication passed on 12th Feb., 1982. The assessee had an option to prefer an appeal within three months. The assessee, however, was advised not to contest the matter any further. The money as such was paid before the time to prefer an appeal had expired. It is, in those circumstances, that the claim for deduction was made during the asst. yr. 1984-85. Mr. Khaitan submitted that when the payment was made, s. 43B had already been introduced to the statute whereunder deduction can only be made after the payment had, in fact, been made. He contended that even without the aid of s. 43B the position would not have been much different. He drew our attention to a Division Bench judgment of this Court in the case of CIT vs. Orient Supply Syndicate, 1982 134 ITR 12 wherein the Division Bench opined as follows:

(3.) He, therefore, submitted that the Tribunal fell into an error of law in disallowing the deduction claimed by the assessee.