present bunch of appeals filed by Department involves common issues relating to disallowance of employer s contribution and employees contribution towards PF, etc., paid by assessee employer after expiry of due date prescribed under relevant statutes. Some of these payments have been made within grace period while remaining payments have been made after expiry of grace period but before due date for filing return of income for respective assessment years. We therefore find it convenient to dispose off all of them by consolidated order. Perusal of assessment orders passed in respective cases shows t h t AO has disallowed employer s contribution and employees contribution to Provident Fund PF, etc., paid by assessee employer after expiry of due date. On appeal, learned CIT(A) has taken note of fact that aforesaid payments have been made by assessee before expiry of due date for filing return of income under s. 139(1) and therefore, has directed AO to allow them. Department is aggrieved by orders of CIT(A) in this behalf and is therefore in appeal before this Tribunal against them. Two issues distinctly arise in present bunch of appeals filed by Department, namely, (i) Whether CIT(A) is justified in directing AO to allow employer s contribution and also employees contribution to Provident Fund, etc., paid by assessee employer after expiry of due date but before expiry of grace period prescribed for making such payment under respective statutes; and (ii) Whether CIT(A) is justified in directing AO to allow aforesaid payments made after expiry of grace period but before due date prescribed for filing return of income under s. 139(1). We shall now deal with each one of them. Deduction in respect of employees contribution to PF, etc., received by assessee employer but paid after expiry of due date falling under s. 36(1)(va). Clause (24) of s. 2 of IT Act defines income . Sub-cl. (x) thereof includes any sum received by assessee from his employees as contributions to any provident fund or superannuation fund or any fund set up under provisions of employees State Insurance Act, 1948 (34 of 1948), or any other fund for welfare of such employees within definition of income . As regards deduction of aforesaid amount in hands of assessee employer, cl. (va) of sub-s. (1) of s. 36 allows deduction of any sum received by assessee from any of his employees to which provisions of sub-cl. (x) of cl. (24) of s. 2 apply, if such sum is credited by assessee to employee s account in relevant fund on or before due date . Explanation to aforesaid clause defines due date as date by which assessee is required as employer to credit employee s contribution to employee s account in relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise . It is therefore quite clear that any sum received by assessee employer from any of his employees as contribution towards any provident fund, etc., is income of assessee under s. 2(24)(x) and it continues to be so unless it is credited by assessee to employee s account in relevant fund on or before due date. law thus lays down specific condition for deduction of any sum received by assessee employer from any of his employee as contribution towards any provident fund, etc. employee s contribution towards PF, etc., received by assessee is his income under s. 2(24)(x). If he wants to have it deducted from his income, he must credit same to employee s account in relevant fund on or before due date. assessee employer cannot therefore claim deduction in respect of aforesaid sum unless he actually credits same to employee s account in relevant fund. case before us however is whether assessee employer is entitled to deduction of any sum received by him from his employees towards aforesaid funds but credited by him to employees account in relevant fund after expiry of due date but before expiry of grace period allowed under relevant Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise. In CIT vs. Shri Ganapathy Mills Co. Ltd. (2000) 243 ITR 879 (Mad), followed in CIT vs. Salem Co-operative Spg. Mills Ltd. (2006) 284 ITR 621 (Mad), Hon ble Madras High Court has held that payments towards provident fund and ESI having been made within grace period allowed under relevant statute are required to be deducted in computation of total income of assessee. We are in respectful agreement with aforesaid decisions. In fact, this Tribunal has also consistently been taking similar view. In this view of matter, we hold, that any sum received by assessee from his employees as contributions to any provident fund or superannuation fund or any fund set up under provisions of employees State Insurance Act, 1948 (34 of 1948), or any other fund for welfare of such employees shall constitute his income unless assessee credits same to employees account in relevant fund before expiry of due date or grace period, if any, allowed under law governing such fund. Amount credited to employee s account after expiry of due date or grace period, if any, allowed under relevant law will not be eligible for deduction under s. 36(1)(va) of IT Act. AO is directed to verify whether sums received by assessee from his employees to which s. 2(24)(x) applies have been credited by assessee to employee s account in relevant fund or funds on or before due date or grace period, if any, allowed under law and, if so, to allow deduction thereof to assessee. For sake of clarity, we reiterate that assessee employer shall not be entitled to claim deduction under s. 36(1)(va) in respect of any sum received by assessee from any of his employees to which s. 2(24)(x) applies unless he credits same to employee s account in relevant fund or funds on or before due date or grace period, if any, allowed under relevant law, whichever is later. Sec. 43B will not apply to cases covered by s. 36(1)(va) as such sum is not allowable under aforesaid provision itself unless it is credited by assessee to employees account in relevant fund by stipulated date. Deduction in respect of Employer s contribution to PF, etc., paid after expiry of due date under s. 36(1)(iv) and (v) Sec. 43B was originally inserted in IT Act by Finance Act, 1983 w.e.f. 1st April, 1984, i.e., for and from asst. yr. 1984-85 to provide that deduction otherwise allowable under IT Act for any sum payable by assessee by way of tax or duty under any law for time being in force [cl. (a) of s. 43B] or any sum payable by assessee as employer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for welfare of employees [cl. (b) of s. 43B] shall (irrespective of previous year in which liability to pay such sum was incurred) be allowed in computing income of that previous year in which such sum is actually paid by assessee. Several other clauses, namely, cls. (c), (d), (e) and (f) were subsequently inserted in s. 43B. We are however not concerned with them in these appeals. Two provisos to s. 43B were inserted by Finance Act, 1987 w.e.f. 1st April, 1988, i.e., for and from asst. yr. 1988-89. During years under appeal, both provisos were operative. First proviso was inserted to provide that deduction otherwise allowable under IT Act in respect of sums referred to in cl. (a) or cl. (c) or cl. (d) or cl. (e) of s. 43B shall not be disallowed in respect of previous year in which liability to pay such sum was incurred provided that such sum is paid by assessee on or before due date applicable in his case for furnishing return under s. 139(1) and evidence of such payment is furnished by assessee along with such return. Second proviso with which we are concerned in present bunch of appeals was inserted to provide that no deduction shall, in respect of any sum referred to in cl. (b) of s. 43B, be allowed unless such sum has actually been paid in previous year on or before due date as defined in Explanation below cl. (va) of sub-s. (1) of s. 36. aforesaid second proviso has been omitted by Finance Act, 2003 w.e.f. 1st April, 2004, i.e., for and from asst. yr. 2004-05. Resultantly, erstwhile first proviso was amended and amended proviso to s. 43B now provides that s. 43B shall not hit deduction otherwise allowable under IT Act in relation to any sum which is actually paid by assessee on or before due date applicable in his case for furnishing return of income under s. 139(1) in respect of previous year in which liability to pay such sum was incurred as aforesaid and evidence of such payment is furnished by assessee along with such return. In other words, distinction that was earlier maintained by two provisos has been done away with. Second proviso, which earlier prohibited deduction of any sum referred to in cl. (b) of s. 43B unless it was actually paid on or before due date, has been done away w.e.f. 1st April, 2004. amended proviso effective from 1st April, 2004 now provides that s. 43B shall not hit deduction otherwise allowable under IT Act in relation to any sum [including those covered by s. 43B(b)] if it is actually paid by assessee on or before due date applicable in his case for furnishing return of income under s. 139(1) in respect of previous year in which liability to pay such sum was incurred as aforesaid and evidence of such payment is furnished by assessee along with such return. In other words, second proviso, which earlier prohibited deduction of any sum referred to in cl. (b) of s. 43B unless it was actually paid on or before due date, has been done away w.e.f. 1st April, 2004. As result of omission of second proviso w.e.f. 1st April, 2004, amended proviso now provides for deduction of any sum covered by s. 43B including one covered by s. 43B(b) if it is paid by due date prescribed for filing return of income under s. 139(1). issue that arises after omission of second proviso and amendment of first proviso is whether amended proviso has retrospective effect so as to cover cases of earlier years also when second proviso was available on statute book. In view of difference of opinion between various Benches of this Tribunal in matter, issue was referred to Special Bench of this Tribunal at Madras in Kwality Milk Foods Ltd. vs. Asstt. CIT (2006) 102 TTJ (Chennai)(SB) 1: (2006) 100 ITD 199 (Chennai)(SB). In said matter, Special Bench has held that amended proviso inserted w.e.f. 1st April, 2004 has retrospective effect and therefore if payment of any sum, which is otherwise allowable under IT Act, is eligible for deduction if it is paid by due date prescribed for filing return under s. 139(1). In CIT vs. Synergy Financial Exchange Ltd. (2006) 205 CTR (Mad) 481, aforesaid issue has been considered by Hon ble Madras High Court in whose jurisdiction Special Bench at Madras is located. Hon ble Madras High Court has held that amended proviso to s. 43B effective from 1st April, 2004 is not retrospective. In view of judgment of Hon ble Madras High Court in Synergy Financial Exchange Ltd. s case (supra), it is no longer possible t o hold that view taken by Special Bench in Kwality Milk Foods Ltd. s case (supra) should still be followed as it would have effect of holding that judgment of Special Bench which stands overruled by its own jurisdictional judgment of Special Bench which stands overruled by its own jurisdictional High Court should be preferred to that of Hon ble Madras High Court. In our view, judgment of Hon ble Madras High Court should be preferred over order of Special Bench of Tribunal located at Madras firstly for reason that that decision of Tribunal overruled by its own jurisdictional High Court stands substituted by decision of High Court and secondly for reason that decision of Special Bench of this Tribunal overruled by High Court, whether jurisdictional or not, ceases to have value of precedent so as to bind other Benches of this Tribunal. In taking aforesaid view, we are supported by several judgments and orders. In Asstt. CCE vs. Dunlop India Ltd. (1985) 154 ITR 172 (SC), it has been held that better wisdom of Court below must yield to higher wisdom of Court above. It cannot be in dispute that High Court is Court above Special Bench or any Bench of this Tribunal. Similar is view taken in CIT vs. G.M. Mittal Stainless Steel Ltd. (2004) 192 CTR (MP) 18: (2005) 142 TAXMAN 349 (MP) and CIT vs. Abhishek Industries Ltd. (2006) 205 CTR (P&H) 304: (2006) 286 ITR 1 (P&H) in which it has been held: It is duty of Tribunal to decide cases on basis of law laid down by Supreme Court/High Court and not what Tribunal decides on particular issue. Every effort must be made by Tribunal to decide issue by taking help from decisions of Supreme Court and if there is no direct authority of Supreme Court on point then of jurisdictional High Court and lastly of any other High Court . In view of these decisions, it is difficult for us to hold that order of Special Bench at Chennai in Kwality Milk Foods Ltd. s case (supra) will prevail over order of Madras High Court in whose jurisdiction Special Bench at Chennai is located. Besides, judgment of Hon ble Madras High Court is solitary judgment dealing with effect of omission of second proviso to s. 43B and consequently with issue whether amended proviso effective from 1st April, 2004 has retrospective effect so as to nullify effect of second proviso in years when second proviso existed on statute book and therefore it is required to be followed and this is more particularly so when we are also in respectful agreement with aforesaid judgment. view that w e are taking in matter is also supported by decision of Hon ble Bombay High Court in CIT vs. Smt. Godavaridevi Saraf (1978) 113 ITR 589 (Bom). Simply because judgment in Synergy Financial Exchange Ltd. (supra) has been rendered by non-jurisdictional High Court, it does not mean that it is not entitled to any respect by Tribunals located outside jurisdiction of said High Court or that its value in terms of precedent is less than value attached to orders of Tribunal. We are well aware of judgment in CIT vs. Thana Electricity Supply Ltd. (1993) 112 CTR (Bom) 356: (1994) 206 ITR 727 (Bom) in which it has been held: decision of one High Court is neither binding precedent for another High Court nor for Courts or Tribunals outside its territorial jurisdiction. . . . . In other States or outside territorial jurisdiction of that High Court it may, at best, have only persuasive effect . As stated earlier, we are greatly persuaded by judgment of Hon ble Madras High Court in Synergy Financial Exchange Ltd. s case (supra) and therefore, we prefer to follow said judgment to orders of Tribunal. learned Authorized Representative for assessee has however relied upon decision of Hon ble Gauhati High Court in CIT vs. George Williamson (Assam) Ltd. (2006) 284 ITR 619 (Gau) for proposition that omission of second proviso and amendment of proviso w.e.f. 1st April, 2004 has retrospective effect. Perusal of said judgment shows that appeal filed by Department was dismissed in aforesaid case by Hon ble Gauhati High Court following its own judgment in CIT vs. Assam Tribune (2002) 253 ITR 93 (Gau) and CIT vs. Bharat Bamboo & Timber Suppliers (1998) 146 CTR (Gau) 487: (1996) 219 ITR 212 (Gau). judgments in Assam Tribune s case (supra) and Bharat Bamboo & Timber Suppliers case (supra) were rendered in context of deduction of sales-tax falling under s. 43B(a) and not in context of s. 43B(b). Besides, aforesaid two judgments were not concerned with consequences following omission of second proviso to s. 43B and amended provisions of proviso to s. 43B inserted by Finance Act, 2003. Similarly, judgment of Hon ble Punjab & Haryana High Court in CIT vs. Avery Cycle Industries (P) Ltd. (No. 1) (2007) 292 ITR 198 (P&H) relied upon by learned Authorized Representative for assessee has been rendered in context of provisions of s. 43B(a), first proviso to s. 43B and Expln. 2 in s. 43B of IT Act and not in context of s. 43B(b) of IT Act. In other judgment, namely, CIT vs. Avery Cycle Industries (P) Ltd. (2007) 292 ITR 200 (P&H) relied upon by learned Authorized Representative for assessee, Hon ble High Court has followed its own judgment in earlier case, namely, Avery Cycle Industries (P) Ltd. (No. 1) s case (supra). There is nothing in said judgment to indicate that it has been rendered in context of second proviso to s. 43B r/w s. 43B(b) of IT Act. learned Authorized Representative for assessee has relied upon another judgment of Hon ble Punjab & Haryana High Court in CIT vs. Madan Lal & Bros. (2005) 195 CTR (P&H) 92: (2005) 276 ITR 571 (P&H) which too has been rendered in context of s. 43B(a) and first proviso to s. 43B r/w Expln. 2 thereto. There is nothing in this judgment also to indicate that said judgment has been rendered in context of provisions of s. 43B(b) and second proviso to s. 43B. learned Authorized Representative for assessee has relied upon judgment of Hon ble Gujarat High Court in CIT vs. Alembic Glass Industries Ltd. (2005) 197 CTR (Guj) 514: (2005) 279 ITR 331 (Guj) which has been rendered for asst. yr. 1984-85. There is no discussion about second proviso to s. 43B in said judgment. It is thus quite clear that none of aforesaid judgments relied upon by learned Authorised Representative for assessee is directly in context of s. 43B(b) and second proviso to s. 43B or effect of omission of second proviso and consequential amendment in first proviso to s. 43B in years prior to omission of second proviso. judgment in Synergy Financial Exchange Ltd. s case (supra) is only judgment, which deals comprehensively with issue under appeal. It is for this reason that we consider it appropriate to follow judgment of Hon ble Madras High Court in Synergy Financial Exchange Ltd. s case (supra). Second proviso to s. 43B, as stated above, has been omitted w.e.f. 1st April, 2004 with result that omission of second proviso has resulted in abrogation or obliteration of second proviso from s. 43B w.e.f. 1st April, 2004 alone. It shall therefore continue to be operative from date of its insertion in s. 43B to date of its abrogation or omission, i.e., from asst. yr. 1988-89 to asst. yr. 2003-04. It is fairly well-settled that law applicable to income-tax assessment proceedings is one operative on first day of relevant assessment year for which assessment is being made. In this view of matter, second proviso will have to be considered and applied to cases covered by present bunch of appeals, as it was very much operative in assessment years under appeal. Secondly, effect of omission of second proviso w.e.f. 1st April, 2004 is that it will stand abrogated or obliterated from s. 43B w.e.f. 1st April, 2004 and therefore, will not apply to assessments for and from asst. yr. 2004-05. This is more so when Legislature has deliberately specified date (i.e., 1st April, 2004) from which second proviso shall stand omitted. In face of such clear manifestation of legislative intent about date from which second proviso shall stand omitted, it is not possible to ignore second proviso in assessment years under appeal. We therefore hold that omission of second proviso is only prospective and not retrospective. view that we have taken in matter is further strengthened by two orders recently passed by Mumbai Benches of this Tribunal: (i) Order passed by J Bench (Mumbai) in ITO vs. Ranisati Fabric Mills (P) Ltd. (ITA No. 5010/Mum/2004, dt. 7th Aug., 2007) (asst. yr. 2000-01); and (ii) Order passed by K Bench (Mumbai) in ITO vs. Indfos Industries Ltd. (ITA No. 8115/Mum/2004, dt. 29th June, 2007) (asst. yr. 2001-02) as also by judgment of Hon ble Rajasthan High Court in CIT vs. Udaipur Distillery Co. Ltd. (2004) 187 CTR (Raj) 369: (2005) 274 ITR 429 (Raj). Before parting with issue, we may wish to clarify that payment of any sum referred to in s. 43B(b) before due date or expiry of grace period, if any, allowed under relevant law, whichever is later shall also be eligible for deduction, for reasons given in para 5 of this order. Second proviso does not hit such payments made within grace period. In view of foregoing, we hold as under: (i) Payment of any sum received by assessee from any of his employees to which s. 2(24)(x) applies shall not be eligible for deduction under s. 36(1)(va) unless it is credited by assessee to employee s account in relevant fund or funds on or before due date or grace period, if any, allowed under relevant law, whichever is later. Since aforesaid sums are liable to be disallowed under s. 36(1)(va) provisions of s. 43B will not come into play as they come into play only when deduction is otherwise allowable under IT Act. (ii) Any sum paid by assessee as employer by way of contribution to provident fund etc., falling under s. 36(1)(iv) and (v) by due date or grace period, if any, allowed under relevant law, whichever is later, will be eligible for deduction in terms of second proviso to s. 43B of IT Act. In case aforesaid sum is not actually paid by assessee in terms of second proviso by due date or grace period, if any, allowed under relevant law governing such fund, then aforesaid sum payable by assessee shall be allowed, irrespective of previous year in which liability to pay such sum was incurred by assessee according to method of accounting regularly employed by him, in computing income referred to in s. 28 of that previous year in which such sum is actually paid by him and not in year in which it is payable by him. (iii) Second proviso is specific to items falling under s. 43B(b) and its omission w.e.f. 1st April, 2004 is not retrospective for reasons explained earlier in this order. For similar reasons we hold that proviso inserted w.e.f. 1st April, 2004 does not have retrospective effect. AO is directed to verify facts of each case under appeal and consider claim of assessee in light of principles spelt out above. AO shall give reasonable opportunity of hearing to assessee. In ITA No. 2994/M/2005 (Asstt. CIT vs. Viraj Alloys Ltd.) also, issue of disallowance under s. 43B(b) is involved. At time of hearing, learned Authorized Representative for assessee submitted that assessee company was sick unit under Sick Industrial Companies (Special Provisions) Act, 1985 and that Board of Industrial and Financial Reconstruction (BIFR) has directed Government of India, vide its summary record of proceedings of hearing held on 2nd April, 2004, that 43B Disallowance relating to payment of sales-tax/loans etc., not to be considered . He submitted that issue under appeal could not therefore be agitated by Department of income-tax in view of provisions of s. 32 of said Act of 1985. We have perused orders passed by Departmental authorities. There is no discussion in this behalf in their orders. We therefore consider it necessary to direct AO to consider this aspect of matter also while deciding upon issue of disallowance under s. 43B in terms of principles spelt out earlier in this order. All appeals filed by Department are treated as allowed for statistical purposes. *** ASSISTANT COMMISSIONER OF INCOME TAX v. VIRAJ FORGINGS LTD.