KIRPAL, J.

The challenge in this writ petition is to section 43 B of the Income-tax Act, 1961, as in force with effect from April 1, 1984 The petitioner is a dealer in motor vehicles and its accounting year is the calendar year. In respect of the assessment year 1985-86, the accounting year ended on December 31, 1984. With regard to the sales made for the quarter ending December 31, 1984, the petitioner paid sales tax on January 31, 1985. The petitioner, however, claimed deduction of the payment of sales tax in the accounting year relevant to the assessment year 1985-86.

The Income-tax Officer, while applying section 43B, disallowed the said deduction claimed and added back the amount. On the basis of the said add back, additional tax has been sought to be recovered from the petitioner. It is also contended that proceedings for penalty and levy of interest have also been initiated.

Section 43B, as it stood in the assessment year 1985-86, reads as under,

"Notwithstanding anything contained in any other provision of this Act, a deduction otherwise allowable under this Act in respect of (a) any sum payable by the assessee by way of tax or duty under any law for the time being in force, or

(b) any sum payable by the assessee as an employer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the welfare of employees.

shall be allowed (irrespective of the previous year in which the liability to pay such sum was incurred by the assessee according to the method of accounting regularly, employed by him) only in computing the income referred to in section 28 of that previous year in which such sum is actually paid by him.

Explanation. -For the removal of doubts, it is hereby declared that where a deduction in respect of any sum referred to in clause (a) or clause (b) of this section is allowed in computing the income referred to in section 28 of the previous year (being a previous year relevant to the assessment year commencing on the lst day of April, 1983, or any earlier assessment year) in which the liability to pay such sum was incurred by the assessee, the assessee shall not be entitled to any deduction under this section in respect of such sum in computing the income of the previous year in which the sum is actually paid by him."

A reading of this section clearly shows that the deduction can be claimed only in the year in which the payment is actually made. In other words, the deduction cannot be allowed as per the principles of the mercantile system of accounting, namely, when the liability arises but now it can be allowed only in the year in which the tax is actually paid. In the present case, the tax having been paid on January 31, 1985, it would be, in the case of the petitioner, in the accounting year ending January 31, 1985, and corresponding to the assessment year 1986-87, that the deduction can be claimed.

It is submitted that this provision, namely, section 43B, is arbitrary and is impossible of compliance. It is true that there may be some difficulty in the petitioner paying sales tax in respect of sales made towards the end of the quarter ending December 31, 1984, but it is not as if the deduction to the petitioner is denied. The only thing that happens is that the deduction can be claimed in the year in which the tax is actually paid, namely, in the following assessment year in the present case. The provision of law is very clear and unambiguous. There are various provisions under the Incometax Act where it has been stipulated that deductions would be allowed, in certain cases, only when the disbursements are actually made by the assessee. We do not find this to be an arbitrary exercise of power or an arbitrary provision. It is well known that books of account are maintained either on mercantile basis or on cash basis. The Legislature has thought fit that, with regard to the payment of sales tax, the deduction is to be allowed only when the payment of sales tax is actually made. Such a provision is not unknown to the Income-tax Act and we do not find it unreasonable or arbitrary. It is submitted by Dr. Singhvi that the petitioner is being subjected to penalty proceedings and interest is also being charged. Whether the penalty is leviable or not is a matter to be gone into in those proceedings which are independent and distinct from assessment proceedings. We would not like to comment on that. All that has to be seen is whether the provision of law is clear and, if it is so, then it is, up to the assessee to follow it or not. If the assessee chooses not to follow that provision of law, then consequences may follow. We find it difficult to accept the contention that because the aforesaid consequences may ensue, due to non-compliance with section 43B, the said provision itself becomes arbitrary and ultra vires article 14 of the ConstitutionIt was next submitted by Dr. Singhvi that the amendment to section 43B has been made in the year 1987 and this amendment, with effect from April 1, 1988, is clarificatory in nature and by applying the said amendment the petitioner was entitled to relief. We are unable to agree with this submission. The amendment clearly states that it is With effect from April 1, 1988. This being so, it is not possible to give the amending provision retrospective effect with effect from April 1, 1984. It was lastly contended that a similar writ petition has been filed in this court, being Civil Writ No. 776 of 1990 and, in that case, notice to show cause has been Issued and stay was granted. We find that rule nisi has not been issued in that case, though a limited stay has been granted. We have considered all the contentions raised by the petitioner before us in the present case and have heard learned counsel for the petitioner at length and we do not find any merit in any of the contentions raised by him and, therefore, we see no reason as to why any notice or rule nisi should be issued. The petition is, accordingly, dismissed in limine.