2012 (9) TMI 765

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....ion precedent. S.L.P. (C) No.16478 of 2011: 3. Place this special leave petition on 26th September, 2012, as first item on Board. 4. The Court wants to know what is the amount reimbursed by the assessee to the school promoted by it towards the deficit. The amount shall be certified by the Chartered Accountant. ORDER 1. Heard learned counsel on both sides. 2. These civil appeals filed by the assessee pertain to Assessment Years 1985-1986, 1986-1987, 1989-1990, 1990-1991 and 1992-1993. The assessee is a limited Company engaged in the business of extraction of manganese and iron ore. The assessee is also a mine owner. For Assessment Year 1985-1986, the assessee filed its Return of Income on 30th October, 1985 declaring a loss....

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....Assessing Officer as well as before C.I.T. (A), we do not find the argument of the assessee that these were reimbursements. As stated above, we are concerned with Assessment Years 1985-1986, 1986-1987, 1989-1990, 1990-1991 and 1992-1993. 6. The interpretation of Section 40A(9) of the Act clearly brings out a dichotomy between 'contribution' and 'reimbursement'. Section 40A(9) of the Act was inserted by Finance Act No.2 of 1984. In the Explanatory Memo to the Finance Bill, 1984, the following explanation indicates the reasons why the word 'contribution' finds place in Section 40A of the Act. We quote hereinbelow Paragraphs 35, 36 and 37 of the Memorandum: "35. Sums contributed by an employer to a recognised provident fund, an approved ....

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.... to the extent required under any other law. 37. With a view to avoiding litigation regarding the allowability of claims for deduction in respect of contributions made in recent years to such trusts, the proposed amendment is being made retrospectively from 1st April, 1980, and will, accordingly, apply in relation to the assessment year 1980-81 and subsequent years." 7. It appears that Section 40A(9) of the Act was inserted as a measure for combating tax avoidance. Suffice it to say that the application of Section 40A(9) of the Act, in the present case, would come into play only after the assessee has established the basic facts. In the present case, we do not know how the ITAT and the High Court have come to the conclusion that these....