Komal TexFab Pvt. Ltd., Ahmedabad V. The DCIT, Circle-2(1)(2), Ahmedabad

ITA 104/AHD/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7752 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 08-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHIV SEVA K
• Keywords: Sale consideration of property below Jantri Value
• Section: 201; 139(1); 28

Judgement Text

PAGE 1 OF 4 , IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH, AHMEDABAD BEFORE , SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND MS . MADHUMITA ROY , JUDICIAL MEMBER ./ ITA NO .104/AHD/2018 / ASSTT . YEAR : 2014 - 2015 KOMAL TEXFAB PVT. LTD. , 167 - 168 , OPP. RAIPUR PATIA, NAROL - SARKHEJ ROAD , AHMEDABAD - 382405 . PAN: AAACK6150C VS . D.C.I.T , CIRCLE 2(1 ) (2) , AHMEDABAD . (APPLICANT) ( RESPON D ENT ) ASSESSEE BY : NONE REVENUE BY : SHRI SHIV SEVAK , SR . DR / DATE OF HEARING : 15 / 07 / 201 9 / DATE OF PRONOUNCEMENT: 14 /10 /2 01 9 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE AS SESSEE AGAINST THE ORDER OF THE LEARNED COMMISS IONER OF INCOME TAX (APPEALS) - 5 , AHMEDABAD [ LD. CIT (A) IN SHORT] , DATED 20 / 10 / 2015 ARISING IN THE MATTER OF ASSESSMENT ORDER PASSED UNDER S. 143 (3) OF THE INCOME TAX ACT, 1961 ( HERE - IN - AFTER REFERRED TO AS 'THE ACT') DATED 05 / 12 / 201 6 RELEVANT TO ASSESSMENT YEAR (AY) 2014 - 15 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: ITA NO .104 / AHD/2018 ASSTT. YEAR 2014 - 15 PAGE 2 OF 4 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN UPHOLDING DISALLOWANCE OF RS. 2.99.218/ - U/S 36(1 )(VA) OF THE ACT WHEN NO SUCH DISALLOWANCE WAS CALLED FOR. 1.1 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN UPHOLDING THE DISALLOWANCE U/S 36(1 )(VA) MADE BY LD. ASSESSING OFFICER AFTER FOLLOWING THE DECISION OF HON'BLE GUJARAT HIGH COURT IN CASE OF CIT V/S GSRTC [TAX APPEAL NO. 637 OF 2013] . THE CIT(A) OUGHT TO HAVE APPRECIATED THAT NO SUCH DISALLOWANCE IS WARRANTED AS THE APPELLANT HAS DEPOSITED EMPLOYEES CONTRIBUTION TO PF & ESIC BEFORE DUE DATE OF FILING RETURN U/S 139(1) OF THE ACT. 2. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND AND/OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL EITHER BEFORE OR DURING THE COUR SE OF HEARING 2. WHEN THE MATTER WAS CALLED FOR HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE. HOWEVER, O N PERUSAL OF THE GROUND OF APPEAL, WE NOTE THAT THE ISSUE RAISED BY THE ASSESSEE HAS BEEN SETTLED BY THE JUDGMENT OF HON BLE GUJARAT HIGH COURT. THEREFORE, WE DECIDED TO PROCEED TO ADJUDICATE THE ISSUE ON MERIT EX - PARTE QUA THE ASSESSEE AFTER HEARING THE L EARNED DR FOR THE REVENUE. 2.1 THE ONLY EFFECTIVE ISSUE RAISED BY THE ASSESSEE IS THAT THE LEARNED CIT (A) ERRED IN CONFIRMING THE ORDER OF THE AO BY UPHOLDING THE DISALLOWANCE OF 2,99,218.00 BEING THE AMOUNT OF EMPLOYEES PF AND ESIC DEPOSITED AFTER TH E DUE DATE. 2.2 THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND ENGAGED IN THE BUSINESS OF MANUFACTURING OF DYED & PRINTED FINISHED CLOTH OF OWN AND ON JOB WORKER BASIS AND TRADING IN GARMENTS. THE ASSESSEE IN THE YEAR UNDER CONSIDERATION HAS DEPOSITED THE EMPLOYEES PROVIDENT FUND AND ESIC AFTER THE DUE DATE AS SPECIFIED UNDER THE RELEVANT ACT AMOUNTING TO 2,99218.00. THE AO ACCORDINGLY FOUND THAT THE IMPUGNED EXPENSES IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 36(1)(VA) READ WITH SECTION 2(24)(X) OF THE A CT. ACCORDINGLY THE AO DISALLOWED THE SAME AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. ITA NO .104 / AHD/2018 ASSTT. YEAR 2014 - 15 PAGE 3 OF 4 3. AGGRIEVED ASSESSEE PREFERRED AN APPEAL TO THE LEARNED CIT (A) WHO HAS CONFIRMED THE ORDER OF THE AO. 4. BEING AGGRIEVED BY THE ORDER OF THE LEARNED CIT - A, THE ASS ESSEE IS IN APPEAL BEFORE US. THE LEARNED DR BEFORE US VEHEMENTLY SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD THE LEARNED DR AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE DELAY IN DEPOSIT MADE TO THE EMPLOYEES PROVIDENT FUND AND ES IC IS NOT ELIGIBLE FOR DEDUCTION BY VIRTUE OF THE DECISION OF HON BLE GUJARAT HIGH COURT IN THE CASE OF CIT VERSUS GSRTC REPORTED IN 366 ITR 170 WHEREIN IT WAS HELD AS UNDER: IN VIEW OF THE ABOVE AND CONSIDERING SECTION 36(1)(VA), READ WITH SUB - CLAUSE ( X) OF CLAUSE (24) OF SECTION 2, IT IS TO BE HELD THAT WITH RESPECT TO THE SUM RECEIVED BY THE ASSESSEE FROM ANY OF HIS EMPLOYEES TO WHICH PROVISIONS OF SUB - CLAUSE (X) OF CLAUSE (24) OF SECTION 2 APPLIES, THE ASSESSEE SHALL BE ENTITLED TO DEDUCTION IN COMPU TING THE INCOME REFERRED TO IN SECTION 28 WITH RESPECT TO SUCH SUM CREDITED BY THE ASSESSEE TO THE EMPLOYEES ACCOUNT IN THE RELEVANT FUND OR FUNDS ON OR BEFORE THE 'DUE DATE' MENTIONED IN EXPLANATION TO SECTION 36(1)(VA). CONSEQUENTLY, IT IS HELD THAT THE TRIBUNAL HAS ERRED IN DELETING RESPECTIVE DISALLOWANCES BEING EMPLOYEES' CONTRIBUTION TO PF ACCOUNT/ESI ACCOUNT MADE BY THE ASSESSING OFFICER AS, AS SUCH, SUCH SUMS WERE NOT CREDITED BY THE RESPECTIVE ASSESSEE TO THE EMPLOYEES 'ACCOUNTS IN THE RELEVANT FUN D OR FUNDS ON OR BEFORE THE DUE DATE AS PER THE EXPLANATION TO SECTION 36(1)(VA) OF THE ACT I.E. DATE BY WHICH THE CONCERNED ASSESSEE WAS REQUIRED AS AN EMPLOYER TO CREDIT EMPLOYEES' CONTRIBUTION TO THE EMPLOYEES ACCOUNT IN THE PROVIDENT FUND UNDER THE PRO VIDENT FUND ACT AND/OR IN THE ESI FUND UNDER THE ESI ACT. ITA NO .104 / AHD/2018 ASSTT. YEAR 2014 - 15 PAGE 4 OF 4 IN VIEW OF THE ABOVE, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF THE AUTHORITIES BELOW. HENCE THE GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS DISMISSED. O RDER PRONOUNCED IN THE COURT ON 14 /10 / 2019 AT AHMEDABAD. - SD - - SD - (MS MADHUMITA ROY ) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (TRUE COPY) A HMEDABAD; DATED 14 / 10 /2019 M ANISH