M/S. S V GHATALIA & ASSOCIATES LLP,KOLKATA vs. DCIT, CIRCLE - 22, KOLKATA, KOLKATA

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ITA 1285/KOL/2017Status: DisposedITAT Kolkata24 April 2019AY 2012-132 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the constitutional validity of a related statutory provision was under challenge before the Supreme Court. Therefore, the Assessing Officer was directed to re-adjudicate the issue afresh, keeping the consequential adjudication in abeyance.

What were the facts?

The assessee claimed a provision for leave encashment based on actuarial valuation. The lower authorities disallowed this provision due to non-payment.

What were the issues?

Whether a provision for leave encashment based on actuarial valuation is allowable when its statutory basis is under challenge before the Supreme Court.

Which sections of the Income-tax Act were involved?

Section 143(3)

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Income Tax Appellate Tribunal, KOLKATA BENCH “D” KOLKATA

Before: Shri S.S.Godara & Dr. A.L. Saini

O R D E R

PER S.S.Godara, Judicial Member:

1.

- This assessee’s appeal for assessment year 2012-13 arises against the Commissioner of Income Tax (Appeals)-6, Kolkata’s order dated 18.04.2017 passed in case No.08/CIT(A)-6/Kol/2015-16 involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short ‘the Act’. Heard both the parties. Case file perused.

2.

The assessee’s sole substantive grievance seeks to reverse both the lower authorities’ action disallowing its provision made for leave encashment of ₹21,31,610/- based on actuarial valuation on account of non-payment thereof. After arguing on the issue for some time, both the learned M/s S V Ghatalia & Associates Vs. DCIT, Cir-22, Kol. Page 2 representatives are ad idem that hon'ble jurisdictional high court’s decision in Exide Industries Ltd. Vs. Union of India (2007) 292 ITR 470 (Cal) quashing statutory provision itself to be unconstitutional stands stayed in hon'ble apex court after in Revenue’s SLP (CC) 12060/2008 admitted on 08.09.2008. We deem it appropriate in this peculiar factual backdrop that the Assessing Officer needs to re-adjudicate the impugned issue afresh as per law. His consequential adjudication would be kept in abeyance till the final outcome of issue pending before the hon'ble apex court hereinabove.

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