TaxTMI 
TaxTMI 
2015 (2) TMI 255
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....the conclusion that the judgment of the Hon'ble Supreme Court of India, in the case of Associated Power Company Limited, reported in 218 ITR, 195 is not retrospective?" 2. The relevant facts are that on 15.11.1995, the return was filed by the respondent - Assessee for the assessment year of 1995-96, wherein the adjustment of Rs. 28,40,247/- was claimed. On 28.11.1995, the Apex Court in the case of Associated Power Company Limited (supra) delivered the judgment, whereby it was held that the amount appropriated to the contingency reserve to meet with the possible exigencies is not a provision known as existing liability and, therefore, not deductible as business expenditure. 30.11.1995 though was the last date of filing return, no othe....
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....of Associated Power Company Limited (supra) and however, as the question has been framed, we need to answer. In our view, the question should not detain us further since it is settled legal position that any judgment of the Apex Court interpreting a particular provision would have its applicability for the prospective effect unless it is expressly made retrospective in the said decision. The reference may be made to the decision of the Apex Court in case of Ashok Kumar Gupta and another V/s. State of U.P. and others reported in (1997) 5 SCC 201, more particularly, observations made by the Apex Court in paragraph 54 as under:- "54. It is settled principle right from Golak Nath ratio that prospective overruling is a part of the principles ....
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....tions made in paragraph 5 of the aforesaid decision which reads as under:- "5. The prospective declaration of law is the devise innovated by the Apex Court to avoid reopening of the settled issues and to prevent multiplicity of proceedings. It is also a devise adopted to avoid uncertainty and avoidable litigation. By the very object of the prospective declaration of the law, it is deemed that all actions taken contrary to the declaration of the law prior to the date of declaration are validated. This is done in the larger public interest. Therefore, the subordinate forums which are legally bound to apply a declaration of law made by this Court are also duty bound to apply such dictum to cases which would arise in future only. In matters ....
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....Graphites Ltd. (supra), the question came up for consideration before the Apex Court as to "whether the Tribunal was justified in deleting the additions made by the Assessing Officer under Section 143(1)(a) in view of the clear cut provisions of Sections 143(1)(a), 143(1A) and 234?" The facts of the said case were that the provisions of the Act were amended with the retrospective effect and the additional tax was made leviable of the Revenue. The Apex Court, by making reference to the decision of the Calcutta High Court in case of Modern Fibotex India Ltd. V/s. Deputy CIT reported in (1995) 212 ITR 496 (Cal) as well as after considering the another decision of the Apex Court in case of Cement Marketing Co. of India Ltd. V/s. Assistant Commi....