S.A.L. Steel Ltd., Ahmedabad V. The Income Tax Officer, Ward-8(1), Ahmedabad

ITA 1217/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8507 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 07-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 43B; 234B; 28

Judgement Text

ITA NO.1217/AHD/2015 SAL STEEL LTD VS. ITO ASSESSMENT YEAR: 2011-12 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND S S GODARA JM] ITA NO. 1217/AHD/2015 ASSESSMENT YEAR: 2011-12 SAL STEEL LTD .............APPELLANT 5/1, SHREEJI HOUSE, B/H MJ LIBRARY, ASHRAM ROAD AHMEDABAD - 380006 [PAN: AAHCS 8284 J ] VS. INCOME-TAX OFFICER .......................RESPONDENT WARD 8(1), AHMEDABAD APPEARANCES BY: NONE FOR THE APPELLANT VK SINGH FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 25.09.2017 DATE OF PRONOUNCING THE ORDER : 25.09.2017 ORDER PER PRAMOD KUMAR, AM: 1. THE PRESENT APPEAL FILED BY THE ASSESSEE-APPELLANT IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-9, AHMEDABAD DATED 20.03.2015 PASSED IN ASSESSMENT YEAR 2011-12. 2. GRIEVANCES RAISED BY THE ASSESSEE ARE AS FOLLOWS:- 1. THE CIT(A) HAS ERRED BOTH IN LAW AND IN FACT IN CONFIRMING DISALLOWANCE OF RS. 13,77,673/- BEING EMPLOYEES CONTRIBUTION OF PF AND ESI HOLDING THAT THE SAME IS NOT DEDUCTIBLE IN COMPUTING TOTAL INCOME. IT IS SUBMITTED BY YOUR APPELLANT THAT THE AMOUNT HAS BEEN PAID BEFORE FILING RETURN OF INCOME AND THAT IN VIEW OF SUPREME COURT JUDGEMENT IN THE CASE OF CTI VS. ALOM EXTRUSIONS LTD. 319 1TR PAGE 306 THE CIT(A) OUGHT TO HAVE ALLOWED THE CLAIM OF YOUR APPELLANT. 2. (A) THE CIT(A) HAS ALSO ERRED IN CONFIRMING LEVY OF INTEREST U'S.234B AND US.234C OF THE ACT. THE OPERATING PART OF CHARGING INTEREST STATES 'CHARGE INTEREST U/S 234B AND 234C' DOES NOT ENTITLE THE ASSESSING OFFICER TO CHARGE INTEREST IN ABSENCE OF A SPEAKING ORDER AS HELD BY ITA NO.1217/AHD/2015 SAL STEEL LTD VS. ITO ASSESSMENT YEAR: 2011-12 PAGE 2 OF 3 GUJARAT HIGH IN THE CASE OF GUJARAT HIGH COURT JUDGEMENT IN THE CASE OF ACIT VS. S.K.. FAMILY TRUST 251 CTR PAGE 427. (B) IT IS FURTHER SUBMITTED THAT IN VIEW OF FACTS OF THE EASE AS WELL AS PROVISIONS OF LAW INTEREST U/S.234 IS ALSO NOT CHARGEABLE AND IS NOT CORRECTLY WORKED OUT THEREFORE THE SAME BE CANCELLED. 3. AT THE TIME OF HEARING BEFORE US, NONE APPEARED ON BEHALF OF THE ASSESSEE. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLICABLE LEGAL POSITION. 4. WE FIND THAT THIS ISSUE HAS BEEN DECIDED AGAINST THE ASSESSEE BY THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. GUJARAT STATE ROAD TRANSPORT CORPORATION, REPORTED IN (2014) 366 ITR 170 (GUJ), WHEREIN THE HONBLE HIGH COURT HELD AS UNDER:- HELD : CONSIDERING SECTION 36(1)(VA) OF INCOME TAX ACT AS IT STANDS, WITH RESPECT TO ANY SUM RECEIVED BY ASSESSEE FROM ANY OF HIS EMPLOYEES TO WHICH PROVISIONS OF CLAUSE (X) OF SUB-SECTION (24) OF SECTION 2 APPLIES, ASSESSEE SHALL NOT BE ENTITLED TO DEDUCTION OF SUCH AMOUNT IN COMPUTING INCOME REFERRED TO IN SECTION 28 IF SUCH SUM WAS NOT CREDITED BY ASSESSEE TO EMPLOYEES ACCOUNT IN RELEVANT FUND OR FUNDS ON OR BEFORE DUE DATE AS PER EXPLANATION TO SECTION 36(1)(VA) OF ACT. MERELY BECAUSE SECOND PROVISO TO SECTION 43B OF THE ACT IN WHICH THERE WAS A REFERENCE TO DUE DATE AS DEFINED IN EXPLANATION BELOW CLAUSE (VA) OF SUB-SECTION (1) OF SECTION 36, IT CANNOT BE HELD THAT EVEN SECTION 36(1)(VA) WAS AMENDED AND/OR EVEN EXPLANATION BELOW CLAUSE (VA) OF SUB- SECTION (1) OF SECTION 36 WAS ALSO DELETED. IT CAN BE SAID THAT THERE WAS A REFERENCE TO EXPLANATION BELOW CLAUSE (VA) OF SUB-SECTION (1) OF SECTION 36 IN SECOND PROVISO OF SECTION 43B (WHICH HAS BEEN DELETED BY FINANCE ACT, 2003), ONLY FOR PURPOSE OF DEFINING DUE DATE AS PER EXPLANATION BELOW CLAUSE (VA) OF SUB-SECTION (1) OF SECTION 36. THEREFORE, BY DELETING SECOND PROVISO TO SECTION 43B BY FINANCE ACT, 2003, IT CANNOT BE SAID THAT SECTION 36(1) (VA) IS AMENDED AND/OR EXPLANATION BELOW CLAUSE (VA) OF SUB- SECTION (1) OF SECTION 36 WAS DELETED, WHICH IS WITH RESPECT TO EMPLOYEES CONTRIBUTION. (PARA 7.11) ....... CONSIDERING SECTION 36(1)(VA) OF INCOME TAX ACT, 1961 READ WITH SUB-CLAUSE (X) OF CLAUSE 24 OF SECTION 2, IT WAS HELD THAT WITH RESPECT TO SUM RECEIVED BY ASSESSEE FROM ANY OF HIS EMPLOYEES TO WHICH PROVISIONS OF SUB-CLAUSE (X) OF CLAUSE (24) OF SECTION (2) APPLIES, ASSESSEE SHALL BE ENTITLED TO DEDUCTION IN COMPUTING INCOME REFERRED TO IN SECTION 28 WITH RESPECT TO SUCH SUM CREDITED BY ASSESSEE TO EMPLOYEES ACCOUNT IN RELEVANT FUND OR FUNDS ON OR BEFORE DUE DATE MENTIONED IN EXPLANATION TO SECTION 36(1)(VA). CONSEQUENTLY, IT WAS HELD THAT LEARNED TRIBUNAL HAD ERRED IN DELETING RESPECTIVE DISALLOWANCES BEING EMPLOYEES CONTRIBUTION TO PF ACCOUNT / ESI ACCOUNT MADE BY AO AS, AS SUCH, SUCH SUMS WERE NOT CREDITED BY RESPECTIVE ASSESSEE TO EMPLOYEES ACCOUNTS IN RELEVANT FUND OR FUNDS (IN PRESENT CASE PROVIDENT FUND AND/OR ESI FUND ON OR BEFORE DUE DATE AS PER EXPLANATION TO SECTION 36(1)(VA) OF ACT I.E. DATE BY WHICH CONCERNED ASSESSEE WAS REQUIRED AS AN EMPLOYER TO CREDIT ITA NO.1217/AHD/2015 SAL STEEL LTD VS. ITO ASSESSMENT YEAR: 2011-12 PAGE 3 OF 3 EMPLOYEES CONTRIBUTION TO EMPLOYEES ACCOUNT IN PROVIDENT FUND UNDER PROVIDENT FUND ACT AND/OR IN THE ESI FUND UNDER ESI ACT. CONSEQUENTLY, ALL THESE APPEALS ARE ALLOWED AND IMPUGNED JUDGEMENT AND ORDERS PASSED BY TRIBUNAL IN DELETING DISALLOWANCES MADE BY AO WAS HEREBY QUASHED AND SET ASIDE AND DISALLOWANCES OF RESPECTIVE SUMS WITH RESPECT TO PROVIDENT FUND / ESI FUND MADE BY AO WAS HEREBY RESTORED. QUESTIONS RAISED IN PRESENT APPEAL ARE ANSWERED IN FAVOUR OF REVENUE. WITH THIS, ALL THESE APPEALS ARE ALLOWED. PARA 8) 5. RESPECTFULLY FOLLOWING THE JUDGEMENT OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF GUJARAT STATE ROAD TRANSPORT CORPORATION (SUPRA), WE UPHOLD THE ORDER OF THE LEARNED CIT(A) IN CONFIRMING THE DISALLOWANCE OF RS.13,77,673/- BEING THE AMOUNT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND & ESI. 6. IN THE RESULT, THE APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 25 TH DAY OF SEPTEMBER, 2017. SD/- SD/- S S GODARA PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 25 TH DAY OF SEPTEMBER, 2017 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ........25.09.2017 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER: ... 25.09.2017........ 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S.: 25.09.2017....... . 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT: ... 25.09.2017...... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ... 27.09.2017... 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: ..