COMMISSIONER OF INCOME TAX vs. NITIN TRADING CO.

ITR/290/1994HC GujaratGJHC24020366199424 November 2005Author: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MS. JUSTICE HARSHA DEVANI4 pages
AI SummaryAllowed

What were the facts?

The Income Tax Appellate Tribunal, Ahmedabad Bench 'A', referred a question of law to the High Court of Gujarat at Ahmedabad. The assessment year in question was 1984-85, corresponding to the accounting period Samvat Year 2039. The reference was made at the instance of the Commissioner of Income Tax (the applicant revenue) against Nitin Trading Co. (the respondent assessee). The revenue was represented by Mr. M.R. Bhatt, learned senior standing counsel, while the assessee, despite being served by Registered Post Acknowledgement Due, did not appear.

What did the High Court hold?

The High Court held that the Tribunal was justified in its decision. Applying the ratio of the Supreme Court decision in Allied Motors (P) Ltd. v. Commissioner of Income Tax, [1997] 224 ITR 677, the Court found that if the unpaid sales tax liability is paid before the time prescribed for the submission of the income tax return under section 139(1) of the Income Tax Act, 1961, no addition can be made by invoking the provisions of Section 43B. The principle established is that for the purpose of Section 43B, payment of a statutory liability before the due date of filing the return under Section 139(1) is considered as payment within the previous year. The question referred was answered in the affirmative, in favour of the assessee and against the revenue. The reference was disposed of accordingly, with no order as to costs.

What were the issues?

1. Whether the Appellate Tribunal is right in law and on facts in holding that if the unpaid sales tax liability is paid before the time prescribed for submission of income tax return under section 139(1), the addition cannot be made invoking the provisions of section 43B? The revenue, through its counsel Mr. M.R. Bhatt, conceded that the controversy is concluded in favour of the assessee by the Supreme Court decision in Allied Motors (P) Ltd. v. Commissioner of Income Tax, [1997] 224 ITR 677. Therefore, the revenue did not present any arguments against the Tribunal's decision. The assessee did not appear to present any arguments.

Which sections of the Income-tax Act were involved?

Section 256(1),Section 139(1),Section 43B

AI-generated summary — verify with the full judgment below

ITR/290/1994 1/4 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No. 290 of 1994 For Approval and Signature: HONOURABLE MR.JUSTICE D.A.MEHTA HONOURABLE MS.JUSTICE H.N.DEVANI ============================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ============================================================== COMMISSIONER OF INCOME TAX - Applicant(s)

Versus NITIN TRADING CO. - Respondent(s) ============================================================== Appearance : MR MANISH R BHATT for Applicant(s) : 1, SERVED BY RPAD - (N) for Respondent(s) : 1, ================================================================== CORAM :  HONOURABLE MR.JUSTICE D.A.MEHTA and HONOURABLE MS.JUSTICE H.N.DEVANI Date : 24/11/2005 ORAL JUDGMENT (Per : HONOURABLE MS.JUSTICE H.N.DEVANI) 1.The Incom

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 256(1)

All 370 judgments and leading authorities on Section 256(1) →

Recent GST High Court judgments

Search GST case law →