2024 (12) TMI 916

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....ss and was neither capital in nature nor personal. Section 36 (1) (iv) of the Act does not specifically debar deduction on account of contribution made under the Provident Fund Act, 1925. It only talks about grant of deduction in respect of recognized provident fund. The contribution to the unrecognized provident fund was deductible." 2. While admitting the appeal, following questions of law have been framed by this Court : "(i) Whether on the facts and in the circumstances of the case, learned ITAT was right in law in relying upon the decision of Hon'ble Punjab & Haryana High Court in the case of CIT vs. Punjab Financial Corporation Ltd. Reported in 295 ITR 510 (P&H) and deleting the addition of Rs. 30,02,13,163/- made on account of contributions to unrecognised provident fund and unapproved pension fund, ignoring the submission of the revenue that there was no proof that the impugned claim by the assessee was as per the Provident Funds Act, 1925? (ii) Whether on the facts and in the circumstances of the case, learned ITAT was right in law in ignoring the ratio of the judgment of Hon'ble Delhi High Court in the case of Sony India P. Ltd. vs. CIT reported in 285 ITR 21....

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....voking the principle of per incuriam and the only course open to the coordinate or smaller Bench is to make a request for reference to the larger Bench. In State of Punjab v. Devans Modern Breweries Ltd. [2004 (11) SCC 26], the Court reiterated that if a coordinate Bench does not agree with the principles of law enunciated by another Bench, the matter has to be referred to a larger Bench. In Central Board of Dwaoodi Bohra Community v. State of Maharashtra [2005 (2) SCC 673], the Constitution Bench interpreted Article 141, referred to various earlier judgments including Bharat Petroleum Corpn. Ltd. v. Mumbai Shramik Sangha (supra), Pradip Chandra Parija and others v. Pramod Chandra Patnaik and others (supra) and held that "the law laid down in a decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or co-equal strength and it would be inappropriate if a Division Bench of two Judges starts overruling the decisions of Division Benches of three Judges. The Court further held that such a practice would be detrimental not only to the rule of discipline and the doctrine of binding precedents but it will also lead to inconsistency in decisions on the....

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....oyer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the welfare of employees, or (c) any sum referred to in clause(ii) of sub-section(1) of section 36, or (d) any sum payable by the assessee as interest on any loan or borrowing from any public financial institution or a State financial Corporation or a State industrial investment corporation, in accordance with the terms and conditions of the agreement governing such loan or borrowing, or (da) xxxx (e) any sum payable by the assessee as interest on any loan or advances from a scheduled bank or a co-operative bank other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank in accordance with the terms and conditions of the agreement governing such loan or advances, or (f) any sum payable by the assessee as an employer in lieu of any leave at the credit of his employee, or (g) xxx (h) xxx Provided that nothing contained in this Section except the provisions of clause(h) shall apply in relation to any sum which is actually paid by the assessee on or before the due date applicable in his case for furnishing t....

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....nation 3B-For the removal of doubts, it is hereby declared that where a deduction in respect of any sum referred to in clause (f) of this section is allowed in computing the income, referred to in section 28, of the previous year (being a previous year relevant to the assessment year commencing on the 1st day of April, 2001, or any earlier assessment year) in which the liability to pay such sum was incurred by the assessee, the assessee shall not be entitled to any deduction under this Section in respect of such sum in computing the income of the previous year in which the sum is actually paid by him. Explanation 3C-For the removal of doubts, it is hereby declared that a deduction of any sum, being interest payable under clause (d) of this section, shall be allowed if such interest has been actually paid and any interest referred to in that clause which has been converted into a loan or borrowing or debenture or any other instrument by which the liability to pay is deferred to a future date shall not be deemed to have been actually paid. Explanation 3CA-xxxxx Explanation 3D-For the removal of doubts, it is hereby declared that a deduction of any sum, being interest payable un....