2007 (4) TMI 260

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....ls) in respect of the additions made by the Assessing Officer under section 40A(5)? (ii) Whether the honourable ITAT was legally justified in confirming the reliefs allowed by the learned Commissioner of Income-tax (Appeals) in respect of the additions made by the Assessing Officer under section 43B? (iii) Whether the honourable ITAT was legally correct in confirming the directions of the learned Commissioner of Income-tax (Appeals) to the Assessing Officer not to charge interest under section 216 ?" 2. The reference relates to the assessment year 1986-87. 3. Briefly stated the facts giving rise to the present reference are as follows: The assessee, a limited company, made the following allowances to its managerial personnel:....

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.... 19 of his order which is reproduced in the order of the Tribunal. The Revenue being aggrieved brought the issue in appeal before the Appellate Tribunal. The Tribunal found that certain decisions of the honourable Patna High Court in the case of Jamshedpur Motor Accessories Stores v. Union of India [1991] 189 ITR 70 and the honourable Orissa High Court in the cast of CIT v. Pyarilal Kasam Manji and Co. [1992] 198 ITR 110 have held that the amendment introduced by Finance Act, 1987, to section 43B was merely of clarificatory nature and applicable with retrospective effect from April 1, 1984. The learned Commissioner of Income (Appeals) had followed the view expressed by the Orissa, Calcutta and Patna High Courts. The Tribunal held that as th....

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....also in view of the decision of this court in I. T. R. No. 48 of 1977 decided today, which is inter parties, wherein similar question has been answered in favour of the assessee. 13. So far as the second question is concerned, we find that the amounts added back under section 43B has been paid over by the assessee to the respective Departments before filing of the return. In view of the decision of the apex court in the case of Allied Motors P. Ltd. v. CIT [1997] 224 ITR 677, wherein the amendments made in section 43B, i.e., the proviso added by the Finance Act, 1987, with effect from April 1, 1988, has been held to be retrospective being clarificatory in nature, the question has to be answered in favour of the assessee. 14. So far as....