SC dismisses Revenue’s
appeal and upholds Delhi & Calcutta HC rulings, rules
that assessee is entitled to claim deduction u/s. 43B in respect of the
excise duty paid in advance in the Personal Ledger Account (‘PLA’) for AYs
1993-1994, 1996-1997, 1997-1998 and 1998-1999; Rejects Revenue’s stand
that since actual payment of excise duty is at the stage of removal of goods,
amount of advance deposit in PLA does not represent actual payment of duty so
as to entitle for Sec. 43B deduction; SC refers to Central Excise rules, notes
that the deposit of Central Excise Duty in the PLA is a statutory requirement,
further notes that upon deposit in the PLA, the amount stands credited to
the Revenue with assessee having no domain over the amount(s) deposited;
Having regard to the object behind the enactment of Section 43B, SC rules
that “it would be consistent to hold that the legislative intent would be
achieved by giving benefit of deduction to an assessee upon advance deposit of
central excise duty notwithstanding the fact that adjustments from such deposit
are made on subsequent clearances/removal effected from time to time.”;
Concludes that the advance deposit of central excise duty constitutes actual
payment of duty within the meaning of Sec 43B and, therefore, the assessee is
entitled to the benefit of deduction; Moreover, SC takes note of
consistent practice followed by assessee (of claiming deduction u/s. 43B in
respect of balance in PLA at the end of accounting year and reversing it in
succeeding year) which was accepted by Revenue in earlier years, further takes
note of Delhi HC and P&H HC rulings in Maruti Suzuki India Ltd., Happy
Forgings Ltd. and Raj and San Deeps Ltd. rendered in favour of assessee, which
attained finality and no contrary view of any other HC was brought on record;
However, SC clarifies that “The Revenue cannot be shut out from the present
proceedings merely because of its acceptance of the practice of accounting
adopted by the assessee or its acceptance of the decision of the two High
Courts in question.”:SC
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