2013 (12) TMI 1662

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....sion for leave encashment as deduction and the same was disallowed by the AO by invoking the provisions of sec. 43B(f) of the Act. Before Ld CIT(A), the assessee submitted that the provision for leave encashment is not a statutory liability but only a contractual liability and accordingly contended that the same would not fall within the purview of sec. 43B of the Act. In this regard, the assessee placed reliance on the decision of Hon'ble Jurisdictional Kerala High Court in the case of CIT Vs. Hindustan Latex Ltd (2012)(209 Taxman 42). The Ld CIT(A), however, confirmed the addition by holding that the facts prevailing in the instant case is distinguishable from that existed in the case of Hindustan Latex Ltd (supra). Aggrieved, the assesse....

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.... its order, has concurred with the view expressed by the Hon'ble Calcutta High Court in the case of Exide Industries Ltd (supra) that Clause (f) of Section 43B is unconstitutional. (b) The decision rendered by the Hon'ble Calcutta High Court has not been challenged before the Supreme Court. (Para 5 and 8). Accordingly, the Hon'ble Kerala High Court, by following the decision rendered by the Hon'ble Supreme Court in the case of Berger Paints Ltd Vs. CIT (266 ITR 99), has further held that the Revenue having not challenged the correctness of the law laid down by the Calcutta High Court, it is not open to the Revenue to challenge its correctness in the case of another assessee. 9. However, we notice that the department has challenged the de....

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....itled to make a claim in its returns". Thus, it is noticed that the Hon'ble Apex Court has not only stayed the operation of the Hon'ble Calcutta High Court in the case of Exide Industries Ltd (supra), but also observed that the assessee would, during the pendency of this Civil Appeal, pay tax as if Section 43B(f) is on the Statute Book. Though the interim orders were passed by the Hon'ble Apex Court in the years 2008/2009, it was not brought to the notice of Hon'ble jurisdictional High Court. We further notice that the Hon'ble Supreme Court has modified the decision rendered in the case of Berger Paints (supra) in its subsequent decision in the case of Gangadharan (304 ITR 61). The operative part of the said decision reads as under:- "In....