MODERN VEER RAYS SECURITY FORCE (INDIA) P.LTD, MUMBAI V. ITO 8(2)(3), MUMBAI

ITA 1205/MUM/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8493 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 19-01-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 15-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUM EET KUMAR
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, J, MUMBAI BEFORE SHRI R V EASWAR, PRESIDENT AND SHRI B RAMAKOTAIAH, ACCOUNTANT MEMBER I T A NO: 1205/MUM/2010 (ASSESSMENT YEAR: 2001-02) M/S MODERN VEER RAYS SECURITY FORCE (INDIA) APPEL LANT PVT. LTD., MUMBAI (PAN: AAACM3692H VS INCOME TAX OFFICER 8(2)(3), MUMBAI RESPONDENT APPELLANT BY: SHRI TARUN GHIA RESPONDENT BY: SHRI SUMEET KUMAR O R D E R R V EASWAR, PRESIDENT: THIS APPEAL BY THE ASSESSEE RELATES TO THE ASSESSM ENT YEAR 2001-02 AND ARISES OUT OF THE ORDER PASSED BY THE A SSESSING OFFICER UNDER SECTION 154 OF THE INCOME TAX ACT, 19 61, ON 20.06.2005. 2. THE FIRST THREE GROUNDS ARE DIRECTED AGAINST THE DISALLOWANCE OF THE EMPLOYERS CONTRIBUTION OF ` 5,33,741/- TOWARDS PROVIDENT FUND AND ESIC. IT IS STATED THAT THE AMOUNTS WERE PAID BEYOND THE GRACE PERIOD ALLOWED UNDER THE RELEVANT STATUTES BU T DURING THE PREVIOUS YEAR AND BEFORE THE DUE DATE FOR FILING TH E RETURN UNDER SECTION 139(1) OF THE ACT. WE FIND FROM PARAGRAPH 4.1 OF THE ORDER OF THE CIT(A) THAT HE HAS ACTUALLY HELD THAT IN VIE W OF THE AMENDMENT TO SECTION 43B, THE EMPLOYERS CONTRIBUTI ON TO WELFARE FUNDS IS ALLOWABLE IF PAID BEFORE THE DUE DATE FOR FILING THE RETURN. IT THEREFORE APPEARS TO US THAT HE HAS ACCEPTED THE AS SESSEES ITA NO: 1205/MUM/2010 2 CONTENTION. WE ALSO FIND FROM THE DETAILS GIVEN IN PARA 4 OF THE ORDER OF THE CIT(A) THAT ALL THE PAYMENTS HAVE BEEN MADE WITHIN THE RELEVANT PREVIOUS YEAR EXCEPT THE PAYMENT OF PROVID ENT FUND FOR MARCH 2001 WHICH HAS BEEN PAID ON 23 RD APRIL 2001. THUS ALL THE PAYMENTS ARE BEFORE THE DUE DATE FOR FILING THE RET URN OF INCOME UNDER SECTION 139(1) OF THE ACT. THEY ARE THEREFOR E ALLOWABLE AS A DEDUCTION. THE CIT(A) HAS ACTUALLY HELD THAT IT IS TO BE ALLOWED AS A DEDUCTION. NEVERTHELESS, IN ORDER TO PUT AN END TO ANY DOUBT, WE HOLD THAT THE ASSESSEE IS ELIGIBLE FOR THE DEDUCTIO N. THE PAYMENT MAY BE ALLOWED IF NOT ALREADY ALLOWED BY THE ASSESS ING OFFICER. SUBJECT TO THIS REMARK, THE GROUNDS ARE DECIDED IN FAVOUR OF THE ASSESSEE. 3. GROUND NOS. 4 TO 6 ARE DIRECTED AGAINST THE DISA LLOWANCE OF ` 4,19,258/-, BEING EMPLOYEES CONTRIBUTION FOR PROVI DENT FUND AND ESIC. THE CIT(A) HAS INVOKED SECTION 36(VA) READ W ITH SECTION 2(24)(X) OF THE INCOME TAX ACT, 1961. HE HAS ALSO STATED THAT THE CHEQUE FOR NOVEMBER 2000 WAS DEPOSITED ON 19 TH DECEMBER 2000 BUT WAS CLEARED ONLY ON 26 TH DECEMBER 2000. HE HAS HELD THAT THE PAYMENTS MADE BEYOND THE DUE DATE AS WELL AS THE GR ACE PERIOD ALLOWED UNDER THE RELEVANT STATUTES CANNOT BE ALLOW ED AS A DEDUCTION. 4. WE FIND THAT THE EMPLOYEES CONTRIBUTION FOR PRO VIDENT FUND PAYMENTS FOR THE MONTHS OF APRIL 2000 TO MARCH 2001 AGGREGATES TO ` 3,82,388/- AND THEIR CONTRIBUTION TO THE ESIC PAYME NTS FOR THE MONTHS OF APRIL 2000 TO FEBRUARY 2001 AGGREGATES TO ` 36,870/-, THE TOTAL FIGURE BEING ` 4,19,258/-. IN CIT VS. AIMIL LTD. AND OTHERS ITA NO: 1205/MUM/2010 3 (2010) 35 DTR (DEL) 68, THE DELHI HIGH COURT HAS HE LD THAT DEDUCTION OF PAYMENT OF EMPLOYEES CONTRIBUTION TOW ARDS PROVIDENT FUND AND ESIC CANNOT BE DISALLOWED UNDER SECTION 43 B IF THE ACTUAL PAYMENT IS MADE BEFORE THE DUE DATE FOR FILI NG THE RETURN UNDER SECTION 139(1), THOUGH SUCH PAYMENT WILL BE B EYOND THE DUE DATES PRESCRIBED UNDER THE RELEVANT STATUTES. THE DATES OF PAYMENT HAVE BEEN GIVEN IN THE ORDER OF THE CIT(A), FROM WH ICH WE FIND THAT ALL THE PAYMENTS HAVE BEEN MADE WITHIN THE RELEVANT PREVIOUS YEAR. IN THESE CIRCUMSTANCES AND RESPECTFULLY FOLLOWING T HE JUDGMENT OF THE DELHI HIGH COURT CITED ABOVE, WE HOLD THAT THE EMPLOYEES CONTRIBUTION SHOULD BE ALLOWED AS A DEDUCTION. WE FIND THAT SUCH A VIEW HAS BEEN TAKEN BY THE COORDINATE BENCH IN MUMB AI IN ITS ORDER DATED 28 TH JANUARY 2010, IN ITA NO: 6847/MUM/2008, IN THE CASE OF M/S PIK PEN PRIVATE LIMITED (COPY OF THE OR DER FILED). IN THIS ORDER THE TRIBUNAL HAS REFERRED TO THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF CIT VS. ALOM EXTRUSIONS LIMITE D (2009) 319 ITR 306 (SC). THUS, FOLLOWING THE JUDGMENT OF THE SUPREME COURT AS WELL AS THE HIGH COURT, AS ALSO THE ORDER OF THE MUMBAI BENCH OF THE TRIBUNAL, WE DIRECT THE ASSESSING OFFICER TO AL LOW THE AMOUNT OF ` 4,19,258/- AS A DEDUCTION. 5. IN THE RESULT, THE APPEAL IS ALLOWED AS STATED A BOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH FEBRUARY 2011. SD/- SD/- (B RAMAKOTAIAH) (R V EASWAR) ACCOUNTANT MEMBER PRESIDENT MUMBAI, DATED 15 TH FEBRUARY 2011 SALDANHA ITA NO: 1205/MUM/2010 4 COPY TO: 1. M/S MODERN VEER RAYS SECURITY FORCE (INDIA) PVT. LTD. 470, GULMOHAR CHS LTD., OSHIWARA, ADARSH NAGAR NEW LINK ROAD, JOGESHWARI (WEST), MUMBAI 400 102 2. ITO, 8(2)(3), MUMBAI 3. CIT-8, MUMBAI 4. CIT(A)-17, MUMBAI 5. DR J BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI