(i) As per provisions of section 132B of the Act the assets seized u\/s 132 or requisitioned u\/s 132A may be adjusted towards the amount of any \u201cexisting liability\u201d. The Explanation 2 to section 132B of the Act inserted by the Finance Act, 2013 w.e.f. 1.6.2013 clarifies that for removal of doubts it is hereby declared that the \u201cexisting liability\u201d does not include \u201cadvance tax\u201d payable in accordance with the provisions of part C of Chapter XVII of the Act. in a Memorandum of Explanation the provisions of Finance Act, 2013 it has been stated that the amendment for insertion of Explanation-1 and Explantion-2 to the provisions of section 132B of the Act are propose to amend the aforesaid section was as to clarify the existing liability does not include advance tax payable in accordance with the provisions of part \u2018C\u2019 of Chapter XVII of the Act. <\/p>\n
(ii) Therefore, the Explanation 2 to section 132B of the Act is a clarificatory provision which was inserted to clarify the intention of the legislature that the \u201cexisting liability\u201d does not include advance tax payable in accordance with the provisions of Part \u2018C\u2019 of Chapter XVII of the Act. Explanation 2 attached to section 132B of the Act, is a clarificatory provision which is of retrospective effect, even if, the same was stated to be applicable from a particular date. We also hold that Explanation 2 to section 132B of the Act is retrospectively effective from the date of insertion of provision of section 132B of the Act w.e.f. 1.6.2002.<\/p>\n
(iii) On the basis of foregoing discussion, we reach to a legal conclusion that the assets or cash seized u\/s 132 of the Act is adjustable against the amount of any \u201cexisting liability\u201d under the Act which does not include \u201cadvance tax\u201d payable in accordance with the provisions of Part \u2018C\u2019 of Chapter XVII of the Act.<\/p>\n