Dy. Commissioner of Income Tax, Circle-2(2), Hyderabad V. GVK Technical & Consultancy Private Limited, Secunderabad

ITA 1378/Hyd/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2670 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 17-01-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 04-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KOMALI KRISHNA
• Assessee Lawyers: V SIVA KUMAR
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 1378/HYD/2017 ASSESSMENT YEAR: 2013-14 DY. COMMISSIONER OF INCOME-TAX, CIRCLE 2(2) HYD. VS. GVK TECHNICAL AND CONSULTANCY PVT. LTD., HYDERABAD. PAN AACCG1259Q APPELLANT RESPONDENT REVENUE BY: SMT. KOMALI KRISHNA ASSESSEE BY: SHRI V. SIVA KUMAR DATE OF HEARING: 17/01/2018 DATE OF PRONOUNCEMENT: 24/01/2018 O R D E R PER S. RIFAUR RAHMAN, AM: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER OF CIT(A) - 2, HYDERABAD, DATED 26/5/2017 RELATES TO THE AY 2013-14 2. BRIEFLY THE FACTS OF THE CASE ARE, THE ASSESSEE M/S GVK TECHNICAL AND CONSULTANCY PVT. LTD., A COMPANY ENGA GED IN THE BUSINESS OF ENGINEERING AND PROJECT CONSULTANCY , FILED ITS RETURN OF INCOME ON 30/09/2013 DECLARING A TOTAL IN COME OF RS. 6,26,72,440/-. THE ASSESSMENT WAS COMPLETED BY THE AO BY DISALLOWING AN AMOUNT OF RS. 34,53,244/- PAID TOWAR DS EMPLOYEES CONTRIBUTION TO THE PF AS THE SAME WAS PA ID BEYOND THE DUE DATE UNDER THE PF ACT. I.T.A. NO. 1378/HYD/2017 GVK TECHNICAL AND CONSULTANCY PVT. LTD., HYD 2 3. AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE CIT(A) AND THE CIT(A) FOLLOWING T HE DECISION OF ITAT, HYDERABAD IN ASSESSEES OWN CASE FOR AY 20 12-13 IN ITA NO. 1248/HYD/2015, ORDER DATED 24/03/2016, DELE TED THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF PAYMENT T OWARDS EMPLOYEES CONTRIBUTION TO THE PF. 4. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENU E IS IN APPEAL BEFORE US RAISING THE FOLLOWING GROUNDS OF A PPEAL: 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHETHER THE CIT(A) IS CORRECT IN LAW IN HOLDING THAT THE PA YMENTS OF THE EMPLOYEES CONTRIBUTION TOWARDS PF BY THE EMPLOYER ASSESSEE AS ALLOWABLE U/S 438 IF PAID BEFO RE THE DUE DATE FOR FILING RETURN OF INCOME, WITHOUT APPRECIATING THE FACT THAT THE SAME IS NOT IN KEEPI NG WITH THE EXPLANATION TO SECTION 36(1)(VA). 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WHET HER THE CIT(A) IS CORRECT IN LAW HOLDING THAT THE PAYME NTS OF THE EMPLOYEES CONTRIBUTION TOWARDS PF BY THE EMPLOY ER ASSESSEE AS ALLOWABLE U/S 438 IF PAID BEFORE THE DU E DATE OF FILING OF RETURN OF INCOME, WITHOUT APPRECI ATING THE FACT THAT THE AMENDMENT MADE IN SECTION 438 OF THE ACT BY THE FINANCE ACT 2003 IS NOT APPLICABLE TO SE CTION 36(1)(VA) SINCE THE AMENDED SECTION 43 APPLIES ONLY TO EMPLOYERS CONTRIBUTION AND NOT TO EMPLOYEES CONTRIBUTION. 3. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME O F HEARING. 5. CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE ISSUE IN DISPU TE IS SQUARELY COVERED BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2012-13 (SUPRA), WHEREIN THE BENCH HAS HELD AS UNDER: 4. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE MATERIAL ON RECORD, WE FIND THAT THE HON'BLE SUPREM E COURT IN THE CASE OF ALOM EXTRUSIONS 319 ITR 306 HA S HELD THAT THE CONTRIBUTIONS TO P.F. AND ESI ARE ALL OWABLE UNDER SECTION 43B OF THE ACT IF THEY ARE PAID BEFOR E THE DUE DATE OF FILING OF THE RETURN OF INCOME. THEREAF TER, THE ISSUE AROSE AS TO WHETHER THE DECISION OF ALOM I.T.A. NO. 1378/HYD/2017 GVK TECHNICAL AND CONSULTANCY PVT. LTD., HYD 3 EXTRUSIONS (CITED SUPRA) WAS APPLICABLE ONLY TO THE EMPLOYER'S CONTRIBUTION AND NOT TO THE EMPLOYEES CONTRIBUTION. VARIOUS HIGH COURTS HAVE HELD THAT TH E DECISION OF HON 'BLE SUPREME COURT, IN THE CASE OF ALOM EXTRUSIONS (CITED SUPRA) IS APPLICABLE TO BOTH THE EMPLOYER'S AS WELL AS EMPLOYEES' CONTRIBUTION TO P. F. AND ESI. THE RESPECTIVE HIGH COURTS, IN THE FOLLOWI NG CASES, HAVE HELD THAT THE EMPLOYEES CONTRIBUTION IS ALSO AN ALLOWABLE DEDUCTION, PROVIDED, IT IS PAID BEFORE THE DUE DATE OF FILING OF THE RETURN. (I) CIT VS. SABARI ENTERPRISES (2007) 298 ITR 141 ( KAR.). (II) MAGUS CUSTOMERS DIALOG P. LTD., (2015) 371 ITR 242 (KAR.) (III) YUM RESTAURANT INDIA P. LTD., (2015) 371 ITR 139 (DEL.) (IV) CIT VS. NIPSO POLY FABRIKS LTD., (2013)350 ITR 327 (HP) (V) CIT VS. NUCHEM LTD., (2015) 371 ITR 164(P&H). 4.1. WE FIND THAT THE COORDINATE BENCH OF THIS TRIB UNAL IN THE CASE OF VBC INDUSTRIES LIMITED, HYDERABAD VS . DCIT, CIRCLE-3(3), HYDERABAD IN ITA.NOS.143 & 144/H/2013 ETC., DATED 08.05.2015 AND ALSO IN THE C ASE OF M/S. VELJAN DENISON LIMITED, HYDERABAD VS. ADDL. CIT, RANGE-3, HYDERABAD IN ITA. NO. 1251/HYD/2015 DATED 16.12.2015, HAS FOLLOWED THE HON'BLE KARNATAK A, RAJASTHAN AND HIMACHAL PRADESH HIGH COURTS TO HOLD THAT THE CONTRIBUTION OF THE EMPLOYEES CONTRIBUTION TO P.F. AND ESI IS ALSO ALLOWABLE IF IT IS PAID BEFORE THE DUE DATE OF FILING OF THE INCOME TAX RETURN. IN THE CAS E BEFORE US, WE FIND THAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 28.09.2012 I.E., BEFORE THE DUE DATE OF F ILING OF THE RETURN OF INCOME WHILE THE PAYMENTS WERE MAD E BY 05.01.2012. THEREFORE, THE ABOVE JUDGMENTS ARE APPLICABLE TO THE FACTS OF THE CASE BEFORE US AND W E DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF T HE LD. CIT(A). ACCORDINGLY, REVENUE'S APPEAL IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D.' AS THE ISSUE UNDER CONSIDERATION IS MATERIALLY IDEN TICAL TO THAT OF AY 2012-13, FOLLOWING THE DECISION OF COORDINATE BENCH IN THAT AY, WE UPHOLD THE ORDER OF CIT(A) IN DELETING THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF EMPLOYEE CONTRIBUTION TO THE PF AS THE DECISION OF THE CIT(A ) IS IN I.T.A. NO. 1378/HYD/2017 GVK TECHNICAL AND CONSULTANCY PVT. LTD., HYD 4 CONSONANCE WITH THE DECISION OF ITAT AND DISMISS TH E GROUNDS RAISED BY THE REVENUE IN THIS REGARD. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. PRONOUNCED IN THE OPEN COURT ON 24 TH JANUARY, 2018. SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER SD/- (S. RIFAUR RAHMAN) ACCOUNTANT MEMBER HYDERABAD, DATED 24 TH JANUARY, 2018 KV COPY FORWARDED TO: 1. DCIT, CIRCLE 2(2), ROOM NO. 513, 5 TH FLOOR, SIGNATURE TOWERS, KONDAPUR, HYD. 2. M/S GVK TECHNICAL AND CONSULTANCY PVT. LTD., 156 -159, PAIGAH HOUSE, SARDAR PATEL ROAD, SECUNDERABAD 500 003 3. CIT(A) - 2, HYDERABAD 4 PR. CIT - 2, HYDERABAD 5 THE DR, ITAT, HYDERABAD 6 GUARD FILE .