ITO, WD-1(2), KOLKATA, Kolkata V. M/s North Brook Jute Co. Ltd., Kolkata

ITA 1355/KOL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1932 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-04-2017
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 13-06-2014
• Court: TRIBUNAL
• Department Lawyers: RAJAT KUMAR KUREEL
• Section: 43B; 139

Judgement Text

ITA NO.1355/KOL/2014 M/S. NORTH BROOK JUTE CO.LTD. A.Y.2004-05 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C KOL KATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM & SHRI M.B ALAGANESH, AM ] ITA NO.1355/KOL/2014 ASSESSMENT YEAR : 2004-05 I.T.O., WARD-1(2), -VERSUS- M/.S. NORTH BROOK JUT E CO. LTD. KOLKATA KOLKATA (PAN:AABCN 5589 P) (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI RAJAT KUMAR KUREEL, JCI T.SR.DR FOR THE RESPONDENT: NONE DATE OF HEARING : 22.03.2017 DATE OF PRONOUNCEMENT : 05.04.2017. ORDER PER N.V.VASUDEVAN, JM: THIS IS AN APPEAL BY THE REVENUE IS DIREC TED AGAINST THE ORDER DATED 05.02.2014 OF CIT(A)-I, KOLKATA RELATING TO A.Y.2004-05. 2. GROUNDS OF APPEAL RAISED BY THE REVENUE READ AS FOLLOWS :- 1. THAT ON THE FACTS AND IN CIRCUMSTANCES OF THE C ASE THE CIT(A) HAS ERRED IN DELETING THE ADDITION MADE BY THE A.O. ON ACCOUNT O F DELAYED PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS P.F. & E.S.I. FOR RS .99,29,494. 2. THE APPELLANT CRAVE LEAVE TO AMEND, MODIFY AND A LTER GROUND OF APPEAL DURING THE COURSE OF HEARING OF THIS CASE. 3. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSIN ESS OF MANUFACTURS AND SALE OF JUTE GOODS. THE ASSESSEE AS AN EMPLOYER WITHHELD TH E PROVIDENT FUND CONTRIBUTION PAYABLE BY ITS EMPLOYEES FROM THEIR SALARIES PAYABL E, AS THEIR SHARE OF CONTRIBUTION TO PROVIDENT FUND (PF) AND EMPLOYEES STATE INSURANCE ( ESI). AS PER SECTION 36(1)(VA) OF THE ACT, THE SUM SO WITHHELD AS EMPLOYEES CONTRI BUTION TO PF & ESI, IF IT IS NOT PAID ON OR BEFORE THE DUE DATE AS PROVIDED UNDER TH E RELEVANT LAW GOVERNING THE PROVIDENT FUND, WILL NOT BE ALLOWED AS DEDUCTION. I T IS THE PLEA OF THE ASSESSEE THAT THE EMPLOYEES CONTRIBUTION TO PF & ESI HAD BEEN PAID B Y THE ASSESSEE ON OR BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME FOR THE REL EVANT ASSESSMENT YEAR U/S 139(1) OF ITA NO.1355/KOL/2014 M/S. NORTH BROOK JUTE CO.LTD. A.Y.2004-05 2 THE ACT AND THEREFORE DEDUCTION CLAIMED SHOULD BE A LLOWED AS PROVIDED UNDER THE PROVISO TO SECTION 43B OF THE ACT. THE SAID PLEA OF THE ASSESSEE WAS REJECTED BY THE AO FOR THE REASON THAT THE PROVISO TO SECTION 43B O F THE ACT CANNOT BE READ INTO THE PROVISION OF SECTION 36(1)(VA) OF THE ACT. 4. ON APPEAL BY THE ASSESSEE, THE CIT(A) DIRECTE D THE AO TO ALLOW THE CLAIM OF THE ASSESSEE FOR DEDUCTION AND IN DOING SO, THE CIT(A) FOLLOWED THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS AIMI L LTD. & ORS. 229 CTR 418 (DEL) WHEREIN IT WAS HELD THAT EMPLOYEES CONTRIBUT ION TO PF SHOULD BE ALLOWED AS DEDUCTION WHICH IS PAID ON OR BEFORE THE DUE DATE O F FILING THE RETURN OF INCOME U/S 139 OF THE ACT. AGGRIEVED BY THE ORDER OF CIT(A) TH E REVENUE HAS RAISED GROUND NO.2 BEFORE THE TRIBUNAL. 5. NONE APPEARED ON BEHALF OF THE ASSESSEE. AT T HE TIME OF HEARING IT WAS BROUGHT TO OUR NOTICE THAT THE HONBLE CALCUTTA HIGH COURT HAS ALSO TAKEN THE VIEW THAT EMPLOYEES CONTRIBUTION TO PF PAID ON OR BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME U/S 139(1) OF THE ACT SHOULD BE ALLOWED AS D EDUCTION. IN THIS REGARD THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF M/S. AKZO NOBEL INDIA LTD. VS CIT IN ITA 110 OF 2011 ORDER DATED 14.06.2016 AN D IN THE CASE OF CIT VS VIJAYSHREE LTD., OF THE HONBLE CALCUTTA HIGH COURT IN GA NO.2607 OF 2011 ORDER DATED 06.09.2011 WAS FILED BEFORE US. IN THE ORDER IN THE CASE OF VIJAYSHREE LTD., (SUPRA), THE HONBLE CALCUTTA HIGH COURT HELD AS FO LLOWS : THE ONLY ISSUE INVOLVED IN THIS APPEAL IS AS TO WH ETHER THE DELETION OF THE ADDITION BY THE ASSESSING OFFICER ON ACCOUNT OF EMP LOYEESCONTRIBUTION TO ESI AND PF BY INVOKING THE PROVISION OF SECTION 36(1)(V A) READ WITH SECTION 2(24)(X) OF THE ACT WAS CORRECT OR NOT. IT APPEARS THAT THE TRIBUNAL BELOW, IN VIEW OF THE DECISION OF THE SUPREME COURT IN THE CASE OF COMMIS SIONER OF INCOME TAX VS. ALOM EXTRUSION LTD., REPORTED IN 2009 VOL.390 ITR 3 06, HELD THAT THE DELETION WAS JUSTIFIED. BEING DISSATISFIED, THE REVENUE HAS COME UP WI TH THE PRESENT APPEAL. AFTER HEARING MR. SINHA, LEARNED ADVOCATE, APPEARIN G ON BEHALF OF THE APPELLANT AND AFTER GOING THROUGH THE DECISION OF T HE SUPREME COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. ALOM EXTRUSION LT D., WE FIND THAT THE ITA NO.1355/KOL/2014 M/S. NORTH BROOK JUTE CO.LTD. A.Y.2004-05 3 SUPREME COURT IN THE AFORESAID CASE HAS HELD THAT T HE AMENDMENT TO THE SECOND PROVISO TO THE SEC. 43(B) OF THE INCOME TAX ACT, AS INTRODUCED BY FINANCE ACT, 2003, WAS CURATIVE IN NAT.URE AND IS REQUIRED TO BE APPLIED RETROSPECTIVELY WITH EFFECT FROM 1 ST APRIL, 1988. SUCH BEING THE POSITION, THE DELETION OF T HE AMOUNT PAID BY THE EMPLOYEES' CONTRIBUTION BEYOND DUE DATE WAS DEDUCTIBLE BY INVO KING THE AFORESAID AMENDED PROVISIONS OF SECTION 43(B) OF THE ACT. WE, THEREFORE, FIND THAT NO SUBSTANTIAL QU ESTION OF LAW IS INVOLVED IN THIS APPEAL AND CONSEQUENTLY, WE DISMISS THIS APPEAL. 6. IN VIEW OF THE AFORESAID DECISION OF THE HON BLE CALCUTTA HIGH COURT, WE DO NOT FIND ANY MERITS IN THE GROUND RAISED BY THE REVENUE AND ACCORDINGLY THE SAME IS DISMISSED. 7 . IN THE RESULT THE APPEAL OF THE REVENUE IS DIS MISSED. O RDER PRONOUNCED IN THE COURT ON 05.04.2017. SD/- SD/- [M.BALAGANESH ] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 05.04.2017. [RG PS] COPY OF THE ORDER FORWARDED TO: 1.M/S. NORTH BROOK JUTE CO.LTD., 6, BRABOURNE ROAD, KOLKATA-1. 2. .I.T.O., WARD-1(2), KOLKATA 3. C.I.T.(A)-I, KOLKATA 4. C.I.T.- I, KOL KATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER, ASST. REGISTRAR, ITAT, KOLKATA BENCHES