Dy. Commissioner of Income Tax , Circle-1(2), Hyderabad V. Country Condo's Limited, Hyderabad

ITA 118/Hyd/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6553 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 12-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Tax effect
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NO. 118/HYD/2018 ASSESSMENT YEAR: 2012-13 DY. CIT, CIRCLE-1(2), HYDERABAD. VS. COUNTRY CONDOS LIMITED, HYDERABAD. PAN AABCN3348N ( A PPELLANT ) (RESPONDENT) REVENUE BY : SMT. N. SWAPNA , DR ASSESSEE BY : S HRI P. MURALI MOHAN RAO , AR DATE OF HEARING 17 . 0 7 . 2018 DATE OF PRONOUNCEMENT 18 . 0 7 . 201 8 O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A)-1, HYDERABAD DATED 22.09.2017 FOR THE A.Y 2012- 13. THE ONLY GRIEVANCE OF THE REVENUE IN ITS APPEAL IS RELATING TO DELETION OF DISALLOWANCE MADE U/S 43B OF THE IT ACT IN RESPECT OF THE CONTRIBUTIONS MADE TO PROVIDENT FUND AND ESI. 2. FACTS IN BRIEF ARE THAT THE A.O WHILE COMPLETING THE ASSESSMENT DISALLOWED PF CONTRIBUTION OF RS. 5,11,924/- AND ESI CONTRIBUTION OF RS. 98,335/- U/S 43B OF THE IT ACT AS THESE WERE REMITTED BEYOND THE DUE DATE SPECIFIED IN THE RESPECTIVE ACTS. ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND THE LD. CIT(A) ANALYSING THE PAYMENTS OF THESE CONTRIBUTIONS AND ALSO THE RELEVANT CASE LAWS ON THE ISSUE HELD THAT AS THESE CONTRIBUTIONS WERE MADE BEFORE DUE DATE OF FILING OF THE RETURN U/S 139(1) OF THE IT ACT, NO DISALLOWANCE IS REQUIRED TO BE MADE. THE CIT(A) FOLLOWED THE DECISION OF THE HONBLE ITAT, HYDERABAD BENCH IN THE CASE OF M/S TETRA SOFT (INDIA) PVT. LTD., 2 ITA NO. 118/HYD/18 COUNTRY CONDOS LIMITED. HYDERABAD. IN ITA NOS. 218 & 219/HYD/2015, DATED 03.06.2015 AND DELETED THE DISALLOWANCE MADE BY THE A.O. AGAINST THIS ORDER, THE REVENUE IS IN APPEAL BEFORE US. 3. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN 10 LAKHS AND THEREFORE, IN VIEW OF THE CBDT CIRCULAR NO. 21/2015 DATED 10.12.2015 THE APPEAL IS LIABLE TO BE DISMISSED. LD. COUNSEL FOR THE ASSESSEE FURTHER, SUBMITTED THAT THE MONETARY LIMIT FOR FILING OF THE APPEAL BY THE REVENUE BEFORE THE TRIBUNAL HAS BEEN INCREASED TO 20 LAKHS VIDE CBDT CIRCULAR NO. 03/2018 DATED 11.07.2018. LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT EVEN ON MERITS AS THE CONTRIBUTIONS WERE PAID BEFORE DUE DATE OF FILING OF THE RETURN THE SAME SHOULD BE ALLOWED AS DEDUCTION, IN VIEW OF VARIOUS CASE LAWS RELIED UPON BEFORE THE CIT(A). 4. ON THE OTHER HAND LD. DR PLACED RELIANCE ON THE DECISIONS IN THE CASE OF CIT VS GUJARAT STATE ROAD TRANSPORT CORPORATION, [2014] 366 ITR 170 (GUJ) AND CIT VS. MERCHEM LTD., [2015] 378 ITR 443 (KERALA) IN SUPPORT OF HER CONTENTIONS THAT THE CONTRIBUTIONS SINCE PAID BEYOND THE DUE DATE AS PRESCRIBED IN THE RESPECTIVE ACTS THEY ARE NOT ALLOWABLE AS DEDUCTION U/S 43B OF THE IT ACT. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. IN THIS CASE THE DISALLOWANCE MADE BY THE A.O TOWARDS PF AND ESI CONTRIBUTIONS ARE RS. 5,11,924/- AND RS. 98,335/- RESPECTIVELY, THE TAX EFFECT ON THESE DISALLOWANCES IS ADMITTEDLY LESS THAN 10 LAKHS. THEREFORE THE APPEAL BY THE REVENUE IS LIABLE TO DISMISSED ON THIS GROUND ITSELF. EVEN ON MERITS ON A CAREFUL PERUSAL OF THE LD. CIT(A) WE FIND THAT THE CIT(A) CONSIDERING THE FOLLOWING DECISIONS AND ALSO 3 ITA NO. 118/HYD/18 COUNTRY CONDOS LIMITED. HYDERABAD. THE FACT THAT THE CONTRIBUTIONS WERE MADE BEFORE DUE DATE OF FILING OF RETURN U/S 139(1) OF THE IT ACT THE DISALLOWANCE MADE BY THE A.O U/S 43B OF THE IT ACT WAS DELETED. 1. CIT VS. MARK AUTO INDUSTRIES LTD., (2013) 40 TAXMANN. COM 482 (PUNJAB & HARYANA) (HC). 2. CIT VS. KICHHA SUGAR CO. LTD., (2013) 35 TAXMANN. COM 54 (UTTARAKHAND). 3. CIT VS. STATE BANK OF BIKANER & JAIPUR (2014) 43 TAXMANN. COM 411 (RAJASTHAN). 4. CIT VS. NIPSO POLYFABRICKS LTD., (2013) 30 TAXMANN.COM 90 (HIMACHAL PRADESH). 5. CIT VS. ALOM EXTRUSIONS LTD., (2009) 185 TAXMANN 416 (SC). 6. CIT VS. SABARI ENTERPRISES (2008) 298 ITR 141 (KAR). 6. WE ALSO OBSERVED FROM THE LD. CIT(A) ORDER THAT SIMILAR VIEW HAS BEEN TAKEN BY THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF M/S TETRA SOFT (INDIA) PVT. LTD., (SUPRA), WHEREIN IT HAS BEEN HELD THAT THE CONTRIBUTIONS MADE WITHIN THE DUE DATE OF FILING OF RETURN U/S 139(1) OF THE IT ACT CANNOT BE DISALLOWED U/S 43B OF THE IT ACT. IN VIEW OF THE ABOVE DISCUSSION THE GROUNDS OF APPEAL OF THE REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 18 TH JULY, 2018. SD/- SD/- (B. RAMAKOTAIAH) (CHALLA NAGENDRA PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 18 TH JULY, 2018 KRK 4 ITA NO. 118/HYD/18 COUNTRY CONDOS LIMITED. HYDERABAD. COPY TO:- 1) COUNTRY CONDOS LTD., 8-2-703, GROUND FLOOR, MAHOGANY COMPLEX, ROAD NO. 12, BANJARA HILLS, HYDERABAD. 34. 2) DY.CIT, CIRCLE-1 (2), HYDERABAD. 3) CIT(A)-1, HYDERABAD. 4) PR. CIT-1, HYDERABAD. 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABAD. 6) GUARD FILE