Eastern Power Distribution Compny of AP Ltd., Visakhapatnam V. THE DCIT, Visakhapatnam

CO 9/VIZ/2015

• Counselvise Citation: [2016] 112 COUNSELVISE.COM (IT) 4195 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 2 month(s) 24 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-07-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 01-06-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 05-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M B REDDY
• Keywords: Revised return
• Section: 43B; 143(2); 139(1); 139

Judgement Text

ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.609/VIZAG/2014 ( / ASSESSMENT YEAR: 2011-12) DCIT, CIRCLE - 3(1), VISAKHAPATNAM VS. M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD., VISAKHAPATNAM [PAN: AAACE9876B ] ( % / APPELLANT) ( &'% / RESPONDENT) C.O. NO.9/VIZAG/2015 (ARISING OUT OF I.T.A.NO.609/VIZAG/2014) ( / ASSESSMENT YEAR: 2011-12) M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD., VISAKHAPATNAM VS. DCIT, CIRCLE - 3(1), VISAKHAPATNAM ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHR I M.B. REDDY, DR / RESPONDENT BY : SHRI G.V.N. HARI, AR / DATE OF HEARING : 21.07.2016 / DATE OF PRONOUNCEMENT : 29.07.2016 ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 2 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE AND CROSS OBJECTI ON FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF CIT( A), VISAKHAPATNAM DATED 11.9.2014 AND IT PERTAINS TO THE ASSESSMENT Y EAR 2011-12. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY WHICH IS ENGAGED IN THE BUSINESS OF PROCURING, DISTRIBUTING AND MAKING SALES OF ELECTRICITY, FILED ITS RETURN OF INCOME FOR THE ASS ESSMENT YEAR 2011-12 ON 30.9.2010 DECLARING NIL TOTAL INCOME AFTER SET OFF OF BROUGHT FORWARD LOSSES OF RS.13,87,64,087/-. THEREAFTER, THE ASSES SEE HAS FILED A REVISED RETURN OF INCOME ON 17.3.2012 DECLARING A GROSS TOT AL INCOME OF RS.13,87,64,087/- AND TOTAL INCOME OF RS.NIL AFTER CLAIMING DEDUCTION U/S 80IA(4)(IV)(C) OF THE INCOME TAX ACT, 1961 (HER EINAFTER CALLED AS THE ACT). THE CASE HAS BEEN SELECTED FOR SCRUTIN Y AND ACCORDINGLY, A NOTICE U/S 143(2) OF THE ACT WAS ISSUED WHICH WAS D ULY SERVED UPON THE ASSESSEE ON 16.8.2012. IN RESPONSE TO NOTICE, THE A UTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED FROM TIME T O TIME AND FURNISHED RELEVANT INFORMATION AS CALLED FOR AND AL SO PRODUCED THE BOOKS OF ACCOUNTS AND OTHER INFORMATION. DURING THE COUR SE OF ASSESSMENT PROCEEDINGS, THE A.O. NOTICED THAT AS PER THE ENCLO SURE TO TAX AUDIT ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 3 REPORT AND THE DOCUMENTS PRODUCED FOR VERIFICATION, THERE IS A DELAY IN REMITTANCES OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND. THEREFORE, ISSUED A NOTICE AND ASKED TO EXPLAIN WHY SAID AMOUN T COULD NOT BE TREATED AS INCOME U/S 2(24)(X) R.W.S. 36(1)(VA) OF THE ACT. IN RESPONSE TO NOTICE, THE ASSESSEE SUBMITTED THAT THE DELAY IN REMITTANCES OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND IS UNAVOID ABLE AND REASONS BEYOND CONTROL, SUCH AS THE COMPANY IS FACING STAFF PROBLEM AND ALSO THE PF AUTHORITIES HAVE INTRODUCED ON LINE PAYMENTS OF PF REMITTANCES. THE ASSESSEE FURTHER SUBMITTED THAT BECAUSE OF NEW SYSTEM OF ONLINE PAYMENT OF PF REMITTANCES, ITS STAFF IS NOT ACQUAIN TED WITH THE KNOWLEDGE OF SUBMISSION OF RETURNS BECAUSE OF WHICH IT HAS HIRED OUTSIDERS TO REMIT THE PAYMENT, THEREFORE, THERE IS A DELAY IN REMITTANCES OF PF CONTRIBUTION. THE ASSESSEE FURTH ER SUBMITTED THAT THOUGH, THERE IS A DELAY IN REMITTANCES OF EMPLOYEE S CONTRIBUTION TO PF WITHIN THE DUE DATE SPECIFIED UNDER THE RESPECTIVE ACT, THE SAME HAS BEEN REMITTED ON OR BEFORE DUE DATE OF FURNISHING R ETURN OF INCOME U/S 139(1) OF THE ACT, THEREFORE, THE SAME SHOULD BE AL LOWED. IN SUPPORT OF ITS SUBMISSIONS, RELIED UPON CERTAIN JUDICIAL DECIS IONS. THE A.O., AFTER CONSIDERING THE EXPLANATIONS OF THE ASSESSEE HELD T HAT AS PER THE PROVISIONS OF SECTION 2(24)(X) R.W.S. 36(1)(VA) OF THE ACT, EMPLOYEES CONTRIBUTIONS TO PF RECEIVED BY THE ASSESSEE IS INC OME IN ITS HANDS AND ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 4 IS DEDUCTIBLE ONLY IF THE SAME IS PAID WITHIN THE D UE DATE AS PRESCRIBED UNDER THE PROVIDENT FUND ACT. THE A.O. FURTHER OBSE RVED THAT THE ASSESSEE SOUGHT TO DISTINGUISH BETWEEN THE EMPLOYER AND EMPLOYEE CONTRIBUTION TO PROVIDENT FUND, BUT, THE FACT IS TH AT BOTH CONTRIBUTIONS ARE DEALT UNDER DIFFERENT PROVISIONS AND ACCORDINGL Y, THE EMPLOYER CONTRIBUTION IS DEALT UNDER THE PROVISIONS OF SECTI ON 43B OF THE ACT AND EMPLOYEES CONTRIBUTION IS DEALT UNDER THE PROVISION S OF SECTION 36(1)(VA) OF THE ACT. THEREFORE, THERE IS NO MERIT IN THE CON TENTION OF THE ASSESSEE THAT BOTH CONTRIBUTIONS ARE ALLOWED, ONCE DEPOSITED ON OR BEFORE THE DUE DATE OF FURNISHING RETURN OF INCOME U/S 139(1) OF T HE ACT. IN SUPPORT OF HIS ARGUMENTS RELIED UPON CERTAIN JUDICIAL DECISION S AND MADE ADDITIONS OF RS.85,50,398/- TOWARDS BELATED PAYMENT OF EMPLOY EES CONTRIBUTIONS TO PROVIDENT FUND. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE A SSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE A.O. THE ASSESSEE FURTHER SUBMITTED THAT SECOND PROVISO TO SECTION 43B OF THE ACT, PROV IDES THAT NO DEDUCTION SHALL BE ALLOWED UNLESS SUCH SUM HAS ACTU ALLY BEEN PAID ON OR BEFORE DUE DATE AS DEFINED IN EXPLANATION 36(1)(VA) OF THE ACT, WHICH WAS OMITTED BY THE FINANCE ACT, 2003 W.E.F. 1.4.200 4 AND ACCORDINGLY THERE WAS NO SPECIAL PROVISION REGARDING EMPLOYEES PROVIDENT FUND TO ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 5 PF. IT WAS FURTHER SUBMITTED THAT AS PER THE AMENDE D PROVISIONS OF SECTION 43B OF THE ACT, ANY SUM PAYABLE BY THE ASSE SSEE AS AN EMPLOYER BY WAY OF CONTRIBUTION TO PF SHALL BE ALLOWED, IN C ASE THE SAME IS PAID ON OR BEFORE DUE DATE OF FURNISHING RETURN OF INCOM E U/S 139(1) OF THE ACT. THE ASSESSEE FURTHER SUBMITTED THAT THE DELAY IN REMITTANCES OF EMPLOYEES CONTRIBUTION WAS DUE TO GENUINE AND UNAV OIDABLE REASON AND NOT AN INTENTIONAL ACT ON THE PART OF THE ASSESSEE. THE ASSESSEE IS HAVING STAFF PROBLEM AND ALSO THE PF AUTHORITIES HA VE INTRODUCED E- PAYMENT SYSTEM WHICH WAS NEW TO THE ASSESSEE AND AS SESSEE EMPLOYEES ARE NOT ACQUAINTED WITH THE KNOWLEDGE OF PROCEDURE OF E- PAYMENT OF PF. THEREFORE, THERE IS A DELAY IN REMI TTANCES WHICH CANNOT BE CONSIDERED AS PURPOSEFUL DELAY IN REMITTANCES OF PF CONTRIBUTION. THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND ALSO FOLLOWING CERTAIN JUDICIAL DECISIONS, HELD THAT THE ASSESSEE WOULD BE ENTITLED FOR DEDUCTION OF EMPLOYEES CONTRIBUTION TO PF MADE BEFORE THE DUE DATE OF FILING RETURN OF INCOME U/S 139(1) OF T HE ACT. WITH THESE OBSERVATIONS, LD. CIT(A) DIRECTED THE A.O. TO DELET E THE ADDITIONS MADE TOWARDS EMPLOYEES CONTRIBUTION TO PF. AGGRIEVED BY THE CIT(A) ORDER, THE REVENUE IS IN APPEAL BEFORE US. 4. THE LD. D.R. SUBMITTED THAT THE CIT(A) ERRED IN HOLDING THAT THE ASSESSEE WOULD BE ENTITLED FOR DEDUCTION OF EMPLOYE ES CONTRIBUTION TO ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 6 PF MADE ON OR BEFORE THE DUE DATE OF FILING RETURN OF INCOME U/S 139(1) OF THE ACT. THE D.R. FURTHER ARGUED THAT THE LD. C IT(A) ERRED IN RELYING UPON THE PROVISIONS OF SECTION 43B OF THE ACT FOR A DJUDICATING THE ISSUE OF EMPLOYEES CONTRIBUTION TO PARTNERSHIP FIRM, AS THE SAID SECTION IS APPLICABLE ONLY IN RESPECT OF EMPLOYER CONTRIBUTION TO PF WHICH OPERATES ON A DIFFERENT PLATFORM AS COMPARED TO THE PROVISIO NS OF SECTION 36(1)(VA) OF THE ACT WHICH IS APPLICABLE TO EMPLOYE ES CONTRIBUTION. THE D.R. FURTHER ARGUED THAT THE CIT(A) CONSIDERED THE CASE LAWS WHICH IS IN FAVOUR OF THE ASSESSEE, BUT AT THE SAME TIME IGNORE D THE CASE LAWS RELIED UPON BY THE A.O. WHICH ARE IN SUPPORT OF THE REVENUE. THERE ARE DIVERGENT VIEWS TAKEN BY VARIOUS HIGH COURTS IN RES PECT OF EMPLOYEES CONTRIBUTION. HOWEVER, THE FACTS REMAINS THAT AS PE R THE PROVISIONS OF SECTION 36(1)(VA) OF THE ACT EMPLOYEES CONTRIBUTIO N IS DEDUCTIBLE ONLY WHEN IT IS REMITTED ON OR BEFORE THE DUE DATE SPECI FIED UNDER THE PF ACT. THEREFORE, THE ASSESSMENT ORDER PASSED BY THE A.O. SHOULD BE UPHELD. ON THE OTHER HAND, THE LD. A.R. FOR THE ASSESSEE ST RONGLY SUPPORTED THE ORDER OF THE CIT(A). 5. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE A.O. MADE ADDITIONS TOWARDS BELATED PAYMENT OF EMPL OYEES ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 7 CONTRIBUTIONS TO PF. ACCORDING TO THE A.O., EMPLOY EES CONTRIBUTION TO PROVIDENT FUND IS DEDUCTIBLE UNDER THE PROVISIONS O F SECTION 36(1)(VA) OF THE ACT, IF THE SAME IS PAID ON OR BEFORE THE DUE D ATE SPECIFIED UNDER THE PROVIDENT FUND ACT. THE A.O. FURTHER WAS OF TH E OPINION THAT IN VIEW OF THE CLEAR PROVISIONS OF SECTION 2(24)(X) R.W.S. 36(1)(VA) OF THE ACT, ANY RECOVERY FROM EMPLOYEES TOWARDS PROVIDENT FUND CONTRIBUTION IS DEEMED TO BE INCOME OF THE ASSESSEE, IF THE EMPLOYE R NOT PAID THE SAME TO THE PROVIDENT FUND ACCOUNT OF THE EMPLOYEE WITHIN DUE DATE SPECIFIED UNDER THE PROVISIONS OF PF ACT. IT IS TH E CONTENTION OF THE ASSESSEE THAT SECOND PROVISO TO SECTION 43B OF THE ACT PROVIDES THAT NO DEDUCTION SHALL BE ALLOWED UNLESS SUCH SUM IS ACTUA LLY BEEN PAID ON OR BEFORE DUE DATE AS SPECIFIED IN EXPLANATION TO 36(1 )(VA) OF THE ACT WHICH WAS OMITTED BY THE FINANCE ACT, 2003 W.E.F. 1.4.200 4 AND ACCORDINGLY, THERE WAS NO SPECIAL PROVISION REGARDING EMPLOYEES CONTRIBUTION TO PF. IT IS FURTHER CONTENDED THAT AS PER THE AMENDED PRO VISIONS OF SECTION 43B OF THE ACT, ANY SUM PAYABLE BY THE ASSESSEE AS AN EMPLOYER BY WAY OF CONTRIBUTION TO PF SHALL BE ALLOWED, IF THE SAME IS PAID ON OR BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME U/S 139( 1) OF THE ACT. 6. THE ONLY ISSUE TO BE RESOLVED IS WHETHER THE ASS ESSEE WOULD BE ENTITLED TO CLAIM DEDUCTION FOR THE EMPLOYEES CONT RIBUTION MADE TO PF AFTER THE DUE DATE PRESCRIBED UNDER THE PF ACT, BUT BEFORE THE DUE DATE ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 8 PRESCRIBED FOR FILING OF INCOME TAX RETURN IN THE L IGHT OF THE PROVISIONS CONTAINED IN SECTION 36(1)(VA) OF THE ACT AND SECTI ON 43B(B) OF THE ACT. IT IS THE CONTENTION OF THE ASSESSEE THAT THERE IS NO DISTINCTION BETWEEN EMPLOYER AND EMPLOYEE CONTRIBUTION AFTER OMISSION O F SECOND PROVISO OF SECTION 43B OF THE ACT BY FINANCE ACT, 2003 W.E.F. 1.4.2004. WE FIND FORCE IN THE ARGUMENTS OF THE ASSESSEE FOR THE REAS ON THAT THERE IS NO DIFFERENCE BETWEEN EMPLOYEES AND EMPLOYER CONTRIBUT ION UNDER THE PF ACT. SECTION 6 OF PROVIDENT FUND ACT PROVIDES FOR CONTRIBUTION AND THE MANNER IN WHICH SUCH CONTRIBUTION SHALL BE MADE. P ARAGRAPH 30 OF THE PF SCHEME PROVIDES FOR PAYMENT OF CONTRIBUTIONS. A S PER THE SAID SCHEME, THE EMPLOYER AT THE FIRST INSTANCE SHALL MA KE THE TOTAL CONTRIBUTION INCLUDING EMPLOYEES SHARE. PARAGRAPH 32 PROVIDES FOR RECOVERY OF MEMBER SHARE OF CONTRIBUTION AND AS PER THE SCHEME, THE EMPLOYER CAN RECOVER THE EMPLOYEES SHARE FROM THE WAGES PAID TO THE EMPLOYEE. THEREFORE, AS PER THE PF ACT AND SCHEME OF CONTRIBUTIONS, THE CONTRIBUTIONS MEANS AND INCLUDE BOTH EMPLOYEES AND EMPLOYERS SHARE. SIMILARLY, SECTION 2(C) OF THE PROVIDENT FU ND ACT DEFINES THE CONTRIBUTION TO MEAN A CONTRIBUTION PAYABLE IN RESP ECT OF A MEMBER UNDER THE SCHEME OR THE CONTRIBUTION PAYABLE IN RES PECT OF AN EMPLOYEE TO WHOM THE SCHEME APPLIES. THERE IS A PRESCRIBED M ODE OF PAYMENT OF CONTRIBUTIONS UNDER THE PF ACT. UNDER THE SAID ACT , THE EMPLOYER SHALL ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 9 CONTRIBUTE BOTH EMPLOYEES AND EMPLOYER SHARE ALONG WITH ADMINISTRATIVE CHARGES BEFORE THE DUE DATE SPECIFIED UNDER THE PF ACT. THE ACT PRESCRIBED ONLY ONE DUE DATE FOR DEPOSITING THE CON TRIBUTION I.E. 15 TH OF SUBSEQUENT MONTH WITH THE GRACE PERIOD OF 5 DAYS WH ICH INDICATES THAT THERE IS NO DIFFERENCE BETWEEN EMPLOYEE AND EMPLOYE R CONTRIBUTION. IF THE LEGISLATURE INTENDS TO DIFFERENTIATE EMPLOYEES AND EMPLOYER CONTRIBUTION, THEN THERE WOULD HAVE BEEN TWO DUE DA TES LIKE IN THE CASE OF INCOME TAX ACT. THEREFORE, FROM THE ABOVE, IT I S CLEAR THAT THE PROVIDENT FUND ACT DOES NOT DIFFERENTIATE EMPLOYEES AND EMPLOYER CONTRIBUTION AND CONTRIBUTION MEANS BOTH EMPLOYEES AND EMPLOYER CONTRIBUTION UNDER THE PF SCHEME. 7. SECTION 43B OF THE ACT PROVIDES FOR CERTAIN DEDU CTIONS TO BE ALLOWED ONLY ON ACTUAL PAYMENT BASIS. SUB CLAUSE ( B) OF SECTION 43B OF THE ACT COVERS ANY SUM PAYABLE BY THE ASSESSEE AS A N EMPLOYER BY WAY OF CONTRIBUTION TO ANY PROVIDENT FUND OR SUPERANNUA TION FUND OR GRATUITY FUND OR ANY OTHER FUND FOR THE WELFARE OF THE EMPLO YEES. THE PROVISO TO SECTION PROVIDES THAT ANY SUM PAID BY THE ASSESSEE ON OR BEFORE THE DUE DATE OF FURNISHING RETURN OF INCOME U/S 139(1) OF T HE ACT, THEN NO DISALLOWANCE CAN BE MADE UNDER THE PROVISIONS OF SE CTION 43B OF THE ACT. A CAREFUL CONSIDERATION OF SECTION 43B OF THE ACT, IT IS CLEAR THAT AN EXTENSION IS GRANTED TO THE ASSESSEE TO MAKE THE PA YMENT OF PF ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 10 CONTRIBUTIONS OR ANY OTHER FUND TILL THE DUE DATE O F FURNISHING RETURN OF INCOME U/S 139(1) OF THE ACT. THEREFORE, IN OUR OP INION, THERE IS NO DIFFERENCE BETWEEN EMPLOYEES AND EMPLOYER CONTRIBUT ION TO PF AND IF SUCH CONTRIBUTION IS MADE ON OR BEFORE THE DUE DATE OF FURNISHING RETURN OF INCOME U/S 139(1) OF THE ACT, THEN DEDUCTION IS TO BE ALLOWED UNDER THE PROVISIONS OF SECTION 43B OF THE ACT. 8. THE HONBLE KARNATAKA HIGH COURT, IN THE CASE OF ESSAE TERAOKA (P) LTD. VS. DCIT 366 ITR 408 TOOK THE VIEW THAT TH E WORD CONTRIBUTION OCCURRING IN SECTION 43B OF THE ACT WOULD INCLUDE E MPLOYEES CONTRIBUTION TO PF IN THE LIGHT OF THE DEFINITION O F THE WORD CONTRIBUTION AS PER THE PROVISIONS OF SECTION 2(C) OF THE PF ACT . AS PER THE SAID SECTION, CONTRIBUTION WOULD MEAN BOTH EMPLOYERS CO NTRIBUTION AND EMPLOYEES CONTRIBUTION. ACCORDINGLY, IT WAS HELD T HAT THE PROVISIONS OF SECTION 43B OF THE ACT ALLOWING DEDUCTION FOR PAYME NT MADE BEFORE THE DUE DATE OF FILING OF INCOME TAX RETURN CANNOT BE I GNORED. SIMILARLY, THE ITAT, HYDERABAD TRIBUNAL IN THE CASE OF TETRA SOFT (INDIA) PVT. LTD. VS. ACIT (2015) 40 ITR (TRIB) 470 HELD THAT WHEN ASSESS EE REMITTED EMPLOYEES CONTRIBUTION TO PF WITHIN DUE DATE OF FI LING RETURN OF INCOME U/S 139(1) OF THE ACT, AMOUNT OF EMPLOYEES CONTRIB UTION TO PF CANNOT BE DISALLOWED. SIMILAR VIEW WAS UPHELD BY THE CHENN AI BENCH OF THE ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 11 ITAT, IN THE CASE OF ACIT VS. FARIDA SHOES PVT. LTD . (2016) 46 CCH 29. THE COORDINATE BENCH HELD THAT IF ASSESSEE HAD NOT DEPOSITED EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND UP T O THE DUE DATE AS PRESCRIBED UNDER RELEVANT STATUTE, BUT BEFORE DUE D ATE OF FILING OF RETURN NO DISALLOWANCE COULD BE MADE IN VIEW OF THE PROVIS IONS OF SECTION 43B OF THE ACT. IN THE CASE OF CIT VS. UDAIPUR DUGDH UT PADAK SAHAKARI SANGH LTD. 35 TAXMAN 616, THE HONBLE HIGH COURT OF RAJASTHAN, AFTER REFERRING TO THE APEX COURT DECISION IN THE CASE OF CIT VS. ALOM EXTRUSIONS LTD. 319 ITR 306 & CIT VS. VINAY CEMENT LTD. HELD THAT THE DEDUCTIONS SHOULD BE ALLOWED FOR THE PAYMENT OF EMP LOYEES CONTRIBUTION MADE BEFORE THE DUE DATE OF FILING OF RETURN. SIMILARLY, IN THE CASE OF CIT VS. STATE BANK OF BIKANER, THE HON BLE RAJASTHAN HIGH COURT HELD THAT CONTRIBUTION PAID AFTER THE DUE DAT E UNDER THE RESPECTIVE ACT, BUT BEFORE FILING THE RETURN OF INCOME U/S 139 (1) OF THE ACT CANNOT BE DISALLOWED U/S 43B OF THE ACT AND OR U/S 36(1)(V A) OF THE ACT. 9. THE LD. D.R. RELIED UPON THE DECISION OF HONBLE HIGH COURT OF KERALA, IN THE CASE OF CIT VS. MERCHEM LTD, REPORTE D IN (2015) 378 ITR 443 AND SUBMITTED THAT EMPLOYEES CONTRIBUTION TO P ROVIDENT FUND IS ALLOWED AS DEDUCTION, IF THE SAME IS DEPOSITED ON O R BEFORE THE DUE DATE SPECIFIED UNDER THE PROVISIONS OF PROVIDENT FUND AC T. THE D.R. ALSO RELIED UPON THE DECISION OF GUJARAT HIGH COURT, REPORTED I N (2014) 366 ITR ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 12 170, WHEREIN THE HONBLE GUJARAT HIGH COURT HELD TH AT SINCE ASSESSEE HAD NOT DEPOSITED SAID CONTRIBUTION TO RESPECTIVE F UND ACCOUNT ON THE DATE AS PRESCRIBED IN EXPLANATION TO SECTION 36(1)( VA) OF THE ACT, DISALLOWANCE MADE BY THE A.O. WAS JUST AND PROPER. THOUGH, THE D.R. RELIED UPON CERTAIN JUDICIAL PRECEDENTS WHICH ARE I N FAVOUR OF THE REVENUE, IN VIEW OF THE DECISION OF HONBLE SUPREME COURT, IN THE CASE OF CIT VS. M/S. VEGETABLES PRODUCTS LTD. REPORTED I N 88 ITR 192, WHEREIN THE HONBLE SUPREME COURT HELD THAT IF TWO REASONABLE CONSTRUCTIONS OF A TAXING PROVISION ARE POSSIBLE TH AT CONSTRUCTION WHICH FAVOURS THE ASSESSEE MUST BE ADOPTED, THEREFORE, BY RESPECTFULLY FOLLOWING THE DECISION OF SUPREME COURT, WHEN DIVER GENT VIEWS ARE EXPRESSED BY DIFFERENT JUDICIAL FORUMS, WE PREFER T O FOLLOW THE VIEWS EXPRESSED BY THE COURTS WHICH ARE IN FAVOUR OF THE ASSESSEE. 10. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THIS CASE AND ALSO FOLLOWING THE JUDICIAL PRECEDENTS AS DISCUSSED ABOV E, WE ARE OF THE VIEW THAT THERE IS NO DISTINCTION BETWEEN EMPLOYEES AND EMPLOYER CONTRIBUTION TO PF, AND IF THE TOTAL CONTRIBUTION I S DEPOSITED ON OR BEFORE THE DUE DATE OF FURNISHING RETURN OF INCOME U/S 139 (1) OF THE ACT, THEN NO DISALLOWANCE CAN BE MADE TOWARDS EMPLOYEES CONT RIBUTION TO PROVIDENT FUND. THE CIT(A) AFTER CONSIDERING THE RE LEVANT DETAILS RIGHTLY DELETED THE ADDITIONS MADE BY THE A.O. WE DO NOT SE E ANY REASONS TO ITA NO.609/VIZAG/2014 & CO 9/VIZAG/2015 M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD ., VISAKHAPATNAM 13 INTERFERE WITH THE ORDER OF THE CIT(A). HENCE, WE INCLINED TO UPHOLD THE CIT(A) ORDER AND DISMISS THE APPEAL FILED BY THE RE VENUE. 15. THE CROSS OBJECTION FILED BY THE ASSESSEE IS IN SUPPORT OF THE ORDER OF CIT(A). THEREFORE, FOR THE REASONS RECORDED IN T HE PRECEDING PARAGRAPHS, WE DISMISS THE CROSS OBJECTION FILED BY THE ASSESSEE AS INFRUCTUOUS. 16. IN THE RESULT, THE APPEAL FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 29 TH JUL16. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 29.07.2016 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE DCIT, CIRCLE-3(1), VISAKHAPA TNAM 2. / THE RESPONDENT M/S. EASTERN POWER DISTRIBUTION COMPANY OF A.P. LTD., CORPORATE OFFICE, P&T COLONY, SEETHAMMADHARA, VISAK HAPATNAM 3. + / THE CIT, VISAKHAPATNAM 4. + ( ) / THE CIT (A), VISAKHAPATNAM 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // 12 . (SR.PRIVATE SECRETARY) . , # / ITAT, VISAKHAPATNAM