Neycer India Limited , CHENNAI V. DCIT Corporate Circle 4(2) , CHENNAI

CO 133/CHNY/2017

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3756 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 03-05-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 18-09-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S NAGARAJAN
• Assessee Lawyers: A R V SREENIVASAN IRS
• Keywords: Question of law
• Section: 43B; 54

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , ! . '#'$ , % !& ' [BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER ] ./I. T.A. NO.1802/CHNY/2017 & C.O.NO.133/CHNY/2017 ( IN ITA NO.1802/CHNY/2017 ) / ASSESSMENT YEAR : 2013-2014. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 4(2) CHENNAI 600 034 VS. M/S. NEYCER INDIA LIMITED, MANASA, NO.145, ST. MARYS ROAD, ALWARPET, CHENNAI 600 018 ( () / APPELLANT) (RESPONDENT/CROSS OBJECTOR) ./I. T.A. NO.1803/CHNY/2017 / ASSESSMENT YEAR : 2014-2015. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 4(2) CHENNAI 600 034 VS. M/S. NEYCER INDIA LIMITED, MANASA, NO.145, ST. MARYS ROAD, ALWARPET, CHENNAI 600 018 [PAN AAACN 1998D] ( () / APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI. AR.V. SREENIVASAN, IRS, JCIT. /RESPONDENT BY : SHRI. S. NAGARAJAN, C.A. /DATE OF HEARING : 24-04-2018 ! /DATE OF PRONOUNCEMENT : 03-05-2018 ITA NOS.1802 &1803/17, CO133/17 :- 2 -: / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER APPEALS FILED BY THE REVENUE ARE DIRECTED AGAINST AN ORDER DATED 09.05.2017 OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-8, CHENNAI FOR ASSESSMENT YEAR 2013-14 AND ASSESSMENT YEAR 2014- 2015. CROSS OBJECTION FILED BY THE ASSESSEE IS ONL Y FOR ASSESSMENT YEAR 2013-2014. 2. REVENUE HAS TAKEN ALTOGETHER THREE GROUNDS OF WHICH GROUND NO. 1 & 3 ARE GENERAL NEEDING NO SPECIFIC AD JUDICATION, 3. GROUND NO.2 WHICH IS THE ONLY EFFECTIVE GROUND IS REPRODUCED HEREUNDER:- 2. THE CIT(A) ERRED IN DELETING THE ADDITION OF RS 42,21,653/- MADE U/S 36(I)(VA) R.W.S 2(24)(X) OF TH E INCOME TAX ACT, 1961. 2.1 AS PER THE PROVISIONS OF SECTION 36(1)(VA) DEDU CTION IN RESPECT OF ANY SUM RECEIVED BY THE TAX PAYER AS CONTRIBUTION FROM HIS EMPLOYEES TOWARDS ANY WELFARE FUND OF SUCH EMPLOYEES IS ALLOWED ONLY IF SUCH SUM IS CREDITED B Y THE TAX PAYER TO THE EMPLOYEES' ACCOUNT IN THE RELEVANT FUND ON OR BEFORE THE DUE DATE. DUE DATE MEANS THE DATE BY WHICH THE ASSESSEE IS REQUIRED AS AN EMPLOYER TO CR EDIT SUCH CONTRIBUTION TO THE EMPLOYEE'S ACCOUNT IN THE RELEVANT FUND UNDER THE PROVISIONS OF ANY LAW OR TE RM OF CONTRACT OF SERVICE OR OTHERWISE. 2.2 IT IS PERTINENT TO MENTION THAT THE PROVISIONS OF SECTION 43B OF THE INCOME TAX ACT 1961 IS NOT APPLI CABLE ITA NOS.1802 &1803/17, CO133/17 :- 3 -: IN THE CASE OF EMPLOYEES' CONTRIBUTION TOWARDS PF/E SI. 2.3 IT IS SUBMITTED THAT THE CBDT IN CIRCULAR NO. 2 2/2015 DATED 17.12.2015 HAS CLARIFIED THAT DEDUCTION RELAT ING TO EMPLOYEES' CONTRIBUTION TO WELFARE FUNDS ARE GOVERN ED BY SECTION 36(1)(VA) OF THE INCOMETAX ACT. THIS CIR CULAR WAS ISSUED BY THE CBDT IN THE LIGHT OF THE JUDICIAL DECISION IN THE C ASE OF CIT VS ALOM EXTRUSIONS LTD (2009) 185 TAXMAN 416 (SC) 2.4 THE DECISION OF THE JURISDICTIONAL HIGH COURT I N THE CASE OF M/S INDUSTRIAL SECURITY & INTELLIGENCE INDI A PVT LTD HAS NOT BEEN ACCEPTED AND A REVIEW PETITION HAS BEEN FILED BEFORE THE HON'BLE HIGH COURT OF MADRAS. 4. LD. COUNSEL FOR THE REVENUE SUBMITTED THAT REVENUE HAD NOT ACCEPTED THE JUDGMENT OF HONBLE JURISDICTIONAL HIG H COURT IN THE CASE OF CIT VS. INDUSTRIAL SECURITY & INTELLIGENCE INDIA P VT LTD. (TCS NO.585 & 586 OF 2015, DATED 24.07.2015). ACCORDING TO HIM, CONTRIBUTION BY THE EMPLOYEES TOWARDS WELFARE FUNDS, REMITTED AFT ER DUE DATE PRESCRIBED IN THE RESPECTIVE ENACTMENTS HAD TO BE D ISALLOWED U/S.36(I) (VA) OF THE ACT. RELIANCE WAS ALSO PLACED ON CBDT CIRCULAR NO.22/2015, DATED 17.12.2015. 5. PER CONTRA, LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL S) WAS FOUNDED ON A JUDGMENT OF JURISDICTIONAL HIGH COURT AND COUL D NOT BE ASSAILED. THAT APART, ACCORDING TO HIM, FOR ASSESSMENT YEAR 2 013-2014, DISALLOWANCE WAS MADE THROUGH A RECTIFICATION U/S.1 54 OF THE INCOME ITA NOS.1802 &1803/17, CO133/17 :- 4 -: TAX ACT, 1961 (IN SHORT THE ACT). THIS ISSUE WA S RAISED BY THE ASSESSEE IN ITS CROSS OBJECTION. 6. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. WHAT HAS BEEN HELD BY HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF INDUSTRIAL SECURITY & INTELLIGENCE INDIA PVT LTD. (SUPRA) IS REPRODUCED HEREUNDER:- 5. WE FIND THAT THE TRIBUNAL HAS RIGHTY RELIED ON THE DECISION OF THE SUPREME COURT IN THE CASE OF CIT VS . ALOM EXTRUSIONS LTD, REPORTED IN 319 ITR 306, WHERE BY THE SUPREME COURT HELD THAT OMISSION OF SECOND PROVISO TO SECTION 43B AND AMENDMENT TO FIRST PROVI SO BY FINANCE ACT, 2003 ARE CURATIVE IN NATURE AND ARE EFFECTIVE RETROSPECTIVELY. I.E. WITH EFFECT FROM 01.01.1988 I.E THE DATE OF INSERTION OF FIRST PROVI SO. THE DELHI HIGH COURT IN THE CASE OF CIT VS. AMIL LT D, REPORTED IN 321 ITR 508 HELD THAT IF THE ASSESSEE HAD DEPOSITED EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND AND ESI AFTER DUE DATE AS PRESCRIBED UNDER THE RELEVANT ACT, BUT BEFORE THE DUE DATE OF FILING OF RETURN UNDER THE INCOME TAX ACT, NO DISALLOWANCE COULD BE MADE IN VIEW OF THE PROVISIONS OF SECTION 43B AS AMENDED BY FINANCE ACT, 2003. 6. IN THE PRESENT CASE, THE ASSESSEE HAD REMITTED THE EMPLOYEES CONTRIBUTION BEYOND THE DUE DATE FOR PAYMENT, BUT WITHIN THE DUE DATE FOR FILING THE RET URN OF INCOME. HENCE, FOLLOWING THE ABOVE SAID DECISION S, WE FIND NO REASON TO DIFFER WITH THE FINDINGS OF TH E TRIBUNAL. ACCORDINGLY, WE FIND NO QUESTION OF LAW MUCH LESS ANY SUBSTANTIAL QUESTION OF LAW ARISES FO R CONSIDERATION IN THESE APPEALS. ITA NOS.1802 &1803/17, CO133/17 :- 5 -: HONBLE JURISDICTIONAL HIGH COURT HAD ALSO CONSIDER ED CBDT CIRCULAR NO.22/2015, DATED 17.12.2015 WHILE GIVING THE JUDGM ENT. IN THE CIRCUMSTANCES, WE DO NOT FIND ANY REASON TO INTERFE RE WITH THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 7. SINCE APPEALS OF THE REVENUE ARE BEING DISMISSED, CROSS OBJECTION FILED BY THE ASSESSEE HAS BECOME INFRUCT UOUS. 8. TO SUMMARIZE THE RESULTS, BOTH THE APPEALS OF THE R EVENUE AS WELL AS CROSS OBJECTION OF THE ASSESSEE ARE DISM ISSED. ORDER PRONOUNCED ON THURSDAY, THE 3 RD DAY OF MAY, 2018, AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( ! . '#'$ ) (ABRAHAM P. GEORGE) % / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 3 RD MAY, 2018 KV &' ()*) / COPY TO: 1 . / APPELLANT 3. +,' / CIT(A) 5. )-. / / DR 2. / RESPONDENT 4. + / CIT 6. .01 / GF