JUDGMENT judgment of court was delivered by Jayant Patel J.-The following question of law has been formulated in present appeal at time of admission of appeal as under: "Whether, on facts and in circumstances of case and in law, Income-tax Appellate Tribunal is right in coming to conclusion that judgment of hon'ble Supreme Court of India in case of Associated Power Co. Ltd. reported in [1996] 218 ITR 195 (SC) is not retrospective?" relevant facts are that on November 15, 1995, return was filed by respondent-assessee for assessment year of 1995-96, wherein adjustment of Rs. 28,40,247 was claimed. On November 28, 1995, apex court in case of Associated Power Co. Ltd. (supra) delivered judgment, whereby it was held that amount appropriated to contingency reserve to meet with possible exigencies is not provision known as existing liability and, therefore, not deductible as business expenditure. November 30, 1995, though was last date of filing return, no other revised return or otherwise was filed. notice under section 143(1) was issued and, thereafter, vide intimation dated September 30, 1996, adjustment of amount of Rs. 28,40,247 was not permitted. Consequently, tax was made leviable but additional tax of Rs. 2,61,303 was also made leviable. assessee carried matter in appeal before Commissioner of Income-tax (Appeals), being Appeal No. CAS-II/293/96-97, which ultimately came to be dismissed. matter was further carried in appeal by assessee before Appellate Tribunal, being I. T. A. No. 381/Ahd/ 1999. Tribunal found that tax is leviable but additional tax is not leviable. Tribunal relied upon decision of apex court in case of CIT v. Hindustan Electro Graphites Ltd. reported in [2000] 243 ITR 48 (SC) and found that assessee had filed return of income which was correct as per law prevailing on date of filing of return and as additional tax has imprint of penalty, Revenue cannot be heard to say that levy of additional tax is automatic under section 143(1)(a) of Act and, hence, partly allowed appeal. Under circumstances, Revenue is in present appeal. We have heard Mr. Sudhir Mehta, learned counsel appearing for appellant and Mr. B. S. Soparkar, learned counsel appearing for respondent- assessee. We may record that there is no express finding by Tribunal on aspect of retrospective operation of decision of apex court in case of Associated Power Co. Ltd. (supra) and, however, as question has been framed, we need to answer. In our view, question should not detain us further since it is settled legal position that any judgment of apex court interpreting particular provision would have its applicability for prospective effect unless it is expressly made retrospective in said decision. reference may be made to decision of apex court in case of Ashok Kumar Gupta v. State of U. P. reported in [1997] 5 SCC 201, more particularly, observations made by apex court in paragraph 54 as under: "54. It is settled principle right from I. C. Golak Nath v. State of Punjab [1967] 2 SCR 762; [1967] AIR 1967 SC 1644 ratio that prospective overruling is part of principles of constitutional canon of interpretation. Though Golak Nath ratio of unamendability of fundamental rights under article 368 of Constitution was overruled in Kesavananda Bharati v. State of Kerala [1973] 4 SCC 225 doctrine of prospective overruling was upheld and followed in several decisions. This court negatived contention in Golak Nath case that prospective overruling amounts to judicial legislation. Explaining Blackstonian theory of law, i.e., judge discovers law and does not make law, and efficacy of prospective overruling at page 808 placitum D to H, this court by Bench of eleven judges had held that doctrine of prospective overruling is modern doctrine and is suitable for fast-moving society. It does not do away with doctrine of stare decisis but confines it to past transactions. While in strict theory, it may be said that doctrine involves making of law, what court really does is to declare law but refuses to give retrospectivity to it. It is really pragmatic solution reconciling two conflicting doctrines, namely, that court finds law and that it does make law. It finds law but restricts its operation to future. It enables courts to bring about smooth transition by correcting errors without disturbing impact of those errors on past transactions..." Useful reference may also be made to another decision of apex court in case of Baburam v. C. C. Jacob reported in [1999] 3 SCC 362, more particularly, observations made in paragraph 5 of aforesaid decision which reads as under: "5. prospective declaration of law is devise innovated by apex court to avoid reopening of settled issues and to prevent multiplicity of proceedings. It is also devise adopted to avoid uncertainty and avoidable litigation. By very object of prospective declaration of law, it is deemed that all actions taken contrary to declaration of law prior to date of declaration are validated. This is done in larger public interest. Therefore, subordinate forums which are legally bound to apply declaration of law made by this court are also duty bound to apply such dictum to cases which would arise in future only. In matters where decisions opposed to said principles have been taken prior to such declaration of law cannot be interfered with on basis of such declaration of law." Hence, said question deserves to be answered in affirmative. Hence, answered accordingly. However, learned counsel appearing for both sides are right on contention that Tribunal did not consider aspects of retrospective or prospective operation of decision of apex court in case of Associated Power Co. Ltd. (supra). It is submitted that Tribunal, as per observations made in paragraph 4.2 in impugned judgment, by relying upon decision in case of Hindustan Electro Graphites Ltd. (supra), found that when on date of filing return, return was correctly filed as per law prevailing on date and additional tax which has imprint of penalty, could not be recovered. learned counsel, therefore, submitted that question may be reframed or another question may be framed by this court as under: "Whether additional tax is leviable even if liability to pay tax as per decision of apex court in case of Associated Power Co. Ltd. reported in [1996] 218 ITR 195 (SC) accrued after filing of return of income-tax but before last date of filing of incometax return?" We may also record that we have heard learned counsel appearing for both sides on aforesaid question of law. In case of Hindustan Electro Graphites Ltd. (supra), question came up for consideration before apex court as to "whether Tribunal was justified in deleting additions made by Assessing Officer under section 143(1)(a) in view of clear-cut provisions of sections 143(1)(a), 143(1A) and 234?" facts of said case were that provisions of Act were amended with retrospective effect and additional tax was made leviable by Revenue. apex court, by making reference to decision of Calcutta High Court in case of Modern Fibotex India Ltd. v. Deputy CIT reported in [1995] 212 ITR 496 (Cal) as well as after considering another decision of apex court in case of Cement Marketing Co. of India Ltd. v. Asst. CST reported in [1980] 124 ITR 15 (SC), observed thus in concluding paragraph (page 55 of 243 ITR): "The assessee could not have suffered additional tax but for Finance Act of 1990. After he had filed his return of income, which was correct as per law on date of filing of return, it was, thereafter, that cash compensatory support also came within sway of section 28. When additional tax has imprint of penalty, Revenue cannot be heard to say that levy of additional tax is automatic under section 143(1A) of Act. If additional tax could be levied in such circumstances, it will be punishing assessee for no fault of his. That cannot ever be legislative intent. It shocks very conscience if in circumstances section 143(1A) could be invoked to levy additional tax." Ultimately, decision of Calcutta High Court was upheld. Hence, our answer to question is to be in negative. Under circumstances, appeal is meritless. Hence, dismissed with no order as to costs. *** Deputy Commissioner of Income-tax (Assessment) v. Surat Electricity Company Ltd