Judgment G.S.Singhvi, J. 1. In this appeal filed under Section 260-A of the Income-tax Act, 1961 (for short, the Act), the appellant (hereinafter described as the assessee) has. prayed for determination of the following questions of law. (a) Whether in the facts and circumstances of the case, the orders Annexures P.2 and P.4 are legally sustainable? (b) Whether in the facts and circumstances of the case, the confirmation of the liability of additional tax even though the total income returned was a loss is legally sustainable? (c) Whether in the facts and circumstances of the case, the confirmation of the leviability of additional tax ignoring the mandate as laid down in 193 I.T.R. 91 and 232 I.T.R. 502 is legally sustainable? (d) Whether in the facts and circumstances of the case, the confirmation of the amount of additional tax imposed on the assessee-appellant is legally sustainable especially when the retrospective operation of the provision has been held to be invalid by Guwahati High Court and Income tax Act being Central Act is binding on Income Tax Authority? For the assessment year 1990-91, the assessee filed return declaring net loss. After some time, it filed revised return and claimed deduction under Section 80-G and 80(2) of the Act. The relevant extract of the revised return are reproduced below: Gross Income as per original return : 6762354 Less (i) Cane cess payable Rs. 837341 as on 387341 31.3.89 paid on 11.4.89 this has been assessed in 89-90 asstt. year (ii) Cess on lime Rs. 448 payable 448 as on 31.3.89 paid on 27.4.89 this has been assessed in 89-90 Asstt. Year (-) 837789 Less S/F losses 6652362 Loss : 727797 Add.: Less @ TAB = B/F Investment allowance - 277569 Loss : 1005366 Agricultural income 23255 Deduction under Sections 80-G and 80(2)(d) may please be allowed as per law. 2. The Assessiong Officer issued notice to the assessee under Section 143(1)(a) of the Act proposing to levy additional tax under Section 143(1A) on account of reduction of the net loss. The assessee challenged the same by filing an application under Section 154 of the Act which was dismissed by Deputy Commissioner of Income-tax, Special Range, Rohtak (respondent No. 2) vide his order dated 23.3.1992. The Commissioner of Income-tax (Appeals) (for short, the CIT (A)] allowed the appeal filed by the assessee and set aside the order passed by respondent No. 2. The Commissioner of Income-tax (Appeals) (for short, the CIT (A)] allowed the appeal filed by the assessee and set aside the order passed by respondent No. 2. The Income-tax Appellate Tribunal, Delhi Bench D New Delhi (for short, the Tribunal) allowed the appeal filed by respondent No. 2 against the appellate order and held that in view of the retrospective amendment in Section 143(1A), additional tax was leviable on the assessee, 3. Shri Akshay Bhan relied on the judgments of the Supreme Court in Commissioner of Income-tax v. Hindustan Electro Graphites Ltd, and of different High Courts in Modi Cement Ltd v. Union of India, (1992)193 I.T.R. 91 (Delhi); J.K. Synthetics Ltd v. Assistant CIT, and Sati Oil Udyog Ltd. and Anr. v. Commissioner of Income-tax and Ors., and argued that the view taken by the Tribunal on the leviability of the additional tax under Section 143(1A) should be declared as vitiated by an error of law and order dated 17.2.2000 passed by it should be quashed. 4. Shri Rajesh Bindal, learned Counsel for the Revenue relied on the judgment of the Supreme Court in Assistant CIT v. J.K. Synthetics vide which two judgments of Delhi High Court were reversed by the Supreme Court and argued that in view of the latest judgment of the three Judge Bench, the assessee cannot seek invalidation of the order passed by the Tribunal. 5. We have given serious thought to the arguments of the learned Counsel. Section 143(1)(a) and Section 143(1A) (unamended) read as under: Section 143(1)(a) 143(1)(a) Where a return has been made under Section 139, or in response to a notice under Sub-section (1) of Section 142,- (i) if any tax or interest is found due on the basis of such return, after adjustment of any tax deducted at source, any advance tax paid and any amount paid otherwise by way of tax or interest, then, without prejudice to the provisions of Sub-section (2). an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under Section 156 and all the provisions of this Act shall apply accordingly; and (ii) if any refund is due on the basis of such return, it shall be granted to the assessee: Provided that in computing the tax or interest payable by, or refundable to, the assessee, the following adjustments shall be made in the income or loss declared in the return, namely: (i) any arithmetical errors in the return, accounts or documents accompanying it shall be rectified: (ii) any loss carried forward, deduction, allowance or relief, which, on the basis of the information available in such return, accounts or documents, is prima facie admissible but which is not claimed in the return, shall be allowed; (iii) any loss carried forward, deduction, allowance or relief claimed in the return, which, on the basis of the information available in such return, accounts or documents, is prima facie inadmissible, shall be disallowed; Provided further that where adjustments are made under the first proviso, an intimation shall be sent to the assessee, notwithstanding that no tax or interest is found due from him after making the said adjustments; Provided also, that an intimation for any tax or interest due under this clause shall not be sent after the expiry of two years from the end of the assessment year in which the income was first assessable. Section 143(1A) (1A)(a) Where, in the case of any person, the total income, as a result of the adjustments made under the first proviso to Clause (a) of Sub-section (i), exceeds the total income declared in the return by any amount, the Assessing Officer shall,- (i) further increase the amount of tax payable under Sub-section (1) by an additional income-tax calculated at the rate of twenty per cent of the tax payable on such excess amount and specify the additional income tax in the intimation to be sent under Sub-clause (i) of Clause (a) of Sub-section (1): (ii) where any refund is due under Sub-section (12), reduce the amount of such refund by an amount equivalent to the additional income tax calculated under Sub-clause (i).Sub-section (1A) of Section 143 was amended by Finance Act, 1993 w.e.f. 1.4,1989. The amended Section reads as under: (1A)(a) Where as a result of the adjustments made under the first proviso to Clause (a) of Sub-section (1)- (i) the income declared by any person in the return is increased; (ii) the loss declared by such person in the return is reduced or is converted into income the Assessing Officer shall,- (A) in a case where the increase in income under Sub-clause (i) of this clause has increased the total income of such person, further increase the amount of tax payable under Sub-section (1) by an additional income tax calculated at the rate of twenty per cent, on the difference between the tax on the total income so increased and the tax that would have been chargeable had such total income been reduced by the amount of adjustments and specify the additional income-tax in the intimation to be sent under Sub-clause (i) of Clause (a) of Sub-section (1); (b) in a case where the loss so declared is reduced under Sub-clause (ii) of this clause or the aforesaid adjustments have the effect of converting that loss into income calculate a sum (hereinafter referred to as the additional income-tax) equal to twenty per cent of the tax that would have been chargeable on the amount of adjustments as if it had been the total income of such person and specify the additional income-tax so calculated in the intimation to be sent under Sub-clause (i) of Clause (a) of Sub-section (1); (c) Where any refund is due under Sub-section (1), reduce the amount of such refund by an amount equivalent to the additional income-tax calculated under Sub-clause (A) or Sub-clause (B), as the case may be. 6. In Assistant CIT v. J.K. Synthetics (supra), their Lordships of the Supreme Court, while reversing two judgments of Delhi High Court, held that where loss declared by an assessee had been reduced by reason of adjustments made under Sub-section (1)(a) the provisions of Sub-section (1A) would apply and being a retrospective amendment, additional tax could be legitimately levied on the assessee. The three Judge Bench distinguished the earlier judgment of two Judge Bench in CIT v. Hindustan Electro Graphites Ltd, (supra) by making the following observations: This was a case in which the return that the assessee had filed was correct by reason of the law as it stood when the return was filed. The three Judge Bench distinguished the earlier judgment of two Judge Bench in CIT v. Hindustan Electro Graphites Ltd, (supra) by making the following observations: This was a case in which the return that the assessee had filed was correct by reason of the law as it stood when the return was filed. A retrospective amendment of Section 28 of the Act rendered that return incorrect. An adjustment in the return was made under Sub-section (1) of Section 143 and, therefore, the provisions of Sub-section (1A) were sought to be invoked. This was challenged and the High Court upheld the challenge, as did this Court. It took the view that the additional penalty under Sub-section (1A) bore the imprint of a penalty and no penalty could be levied because the return filed by the assessee was correct when it was filed. This judgment has no application to the facts of the present case for the reason that it is no bodys case that a retrospective amendment has rendered a correct return filed by the assessee incorrect. The question here is only whether a loss which is reduced by reason of the application of the provisions of Sub-section (1)(a) falls within the ambit of Sub-section (A). We should add that we have reservations about the correctness of the judgment in Hindustan Electro Graphite Ltds case principally because the assessee in that case had not challenged the provisions of sub section (I A), The appeal is allowed. The order under appeal is set aside. 7 In view of the law laid down by the Supreme Court in the case of Assistant CIT v. J.K. Synthetics Ltd. (supra), it is not possible to find any fault; with the orders passed by respondent No. 2 and the Tribunal in the matter of levy of additional tax under Section 143(1A) of the Act. 8. The judgment of Gauhati High Court in Sati Oil Udyog Ltd. and Anr. v. Commissioner of Income-tax and Ors. (supra), on which reliance has been placed by the learned Counsel for the assessee has no bearing on the present case because the main question decided in that case related to the vires of Section 143(1A) as substituted by Finance Act, 1993. While upholding the constitionality of the provision, the learned Single Judge of Gauhati High Court held that the same cannot be given retrospective effect. While upholding the constitionality of the provision, the learned Single Judge of Gauhati High Court held that the same cannot be given retrospective effect. The appellant has not challenged the vires of Section 143(1A) of the Act and in so far as its retrospective applicability is concerned, the judgment of the Supreme Court in the case of J.K. Synthetics (supra) is conclusive.In the result, the appeal is dismissed,