2008-VIL-64-SC-DT

Equivalent Citation: [2009] 222 CTR 214 (SC)/ [2009] 183 Taxman 80 (SC)

Supreme Court of India

Civil Appeal No. 7191 of 2008

Date: 08.12.2008

L.K. TRUST

Vs

COMMISSIONER OF INCOME TAX & ANR.

BENCH

S. H. Kapadia And B. Sudershan Reddy, JJ.

JUDGMENT

Leave granted.

2. In this civil appeal appellant-assessee is denied the benefit of interest allowance under s. 36(1)(iii) of the IT Act on account of the proviso inserted in that section w.e.f. 1st April, 2004. However, as held by this Court in the case of Dy. CIT vs. Core Health Care Ltd. (2008) 215 CTR (SC) 1: (2008) 298 ITR 194(SC), the said proviso is amendatory and not clarificatory in nature. In the circumstances, the proviso would operate prospectively. That proviso could not have been applied to deny the claim of the assessee for deduction on account of interest paid by it because in this case we are concerned with the asst. yr. 1989-90.

3. We may clarify that according to the Department even without the proviso appellant would not be entitled to the benefit of interest allowance under s. 36(1)(iii) as it stood at the material time. We express no opinion on that point in this case.

4. Accordingly, this civil appeal stands allowed and the matter is remitted to the High Court for its decision in accordance with law.

 

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