M/s Jagdamba Industries Ltd., Kolkata V. ACIT, CC-XXX, KOLKATA, Kolkata

ITA 1448/KOL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9283 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 26-06-2014
• Court: TRIBUNAL
• Assessee Lawyers: SHIKHA AGA RWAL ACA
• Keywords: Business expenditure
• Section: 43B; 139

Judgement Text

ITA NO.1448/KOL/2014-M/S. JAGDAMBA INDUSTRIES LTD. A.Y.2009-10 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : KOLKATA [BEFORE HONBLE SRI N.V.VASUDEVAN, JM & DR.ARJUN LAL SAINI, AM] I.T.A NO. 1448/KOL/20 14 ASSESSMENT YEAR : 2009-1 0 M/S. JAGDAMBA INDUSTRIES LTD. -VS.- A.C.I. T., CENTRAL CIRCLE-XXX, KOLKATA KOLKATA [PAN : AAACJ 6843 R] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : MS. SHIKHA AGA RWAL, ACA FOR THE RESPONDENT : NONE DATE OF HEARING : 02.03.2017. DATE OF PRONOUNCEMENT : 08.03.2017. ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 25.04.2014 OF CIT(A)-III, KOLKATA RELATING TO A.Y.2009-10 2. GROUNDS OF APPEAL RAISED BY THE ASSESSEE READ AS FOLLOWS :- 1. I HAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) ERRED IN CONFIRMING DISALLOWANCE OF RS.4,27,843/-, BEING THE AMOUNT OF EMPLOYEES' CONTRIBUTION TO PF, MADE BY THE AO ON THE GROUND TH AT THE PAYMENT WAS MADE AFTER THE DUE DATE OF DEPOSIT. THE PAYMENT WAS MADE TO THE PF BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME UNDER SEC 139(1) AND HENCE SAME WAS ALLOWABLE BUSINESS EXPENDITURE. THE ADDITION, THEREFORE, NEED S TO BE DELETED. 2. THAT THE ASSESSEE CRAVES LEAVE TO ADD, ALTER, AM END OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 3. THE ASSESSEE AS AN EMPLOYER WITHHELD THE PROV IDENT FUND CONTRIBUTION PAYABLE BY ITS EMPLOYEES FROM THEIR SALARIES PAYABLE, AS THEIR SHARE OF CONTRIBUTION TO PF. AS PER SECTION 36(1)(VA) OF THE ACT, THE SUM SO WITHHELD A S EMPLOYEES CONTRIBUTION TO PF, IF IT IS NOT PAID ON OR BEFORE THE DUE DATE AS PROVID ED UNDER THE RELEVANT LAW GOVERNING THE PROVIDENT FUND, WILL NOT BE ALLOWED AS DEDUCTIO N. IT IS THE PLEA OF THE ASSESSEE THAT ITA NO.1448/KOL/2014-M/S. JAGDAMBA INDUSTRIES LTD. A.Y.2009-10 2 THE EMPLOYEES CONTRIBUTION TO PF HAD BEEN PAID BY THE ASSESSEE ON OR BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME FOR THE RELEVAN T ASSESSMENT YEAR U/S 139(1) OF THE ACT AND THEREFORE DEDUCTION CLAIMED SHOULD BE ALLOW ED AS PROVIDED UNDER THE PROVISO TO SECTION 43B OF THE ACT. THE SAID PLEA OF THE ASS ESSEE WAS REJECTED BY THE AO FOR THE REASON THAT THE PROVISO TO SECTION 43B OF THE ACT C ANNOT BE READ INTO THE PROVISION OF SECTION 36(1)(VA) OF THE ACT. 4. ON APPEAL BY THE ASSESSEE, THE CIT(A) CONFIRM ED THE ORDER OF THE AO. HENCE THE PRESENT APPEAL BY THE ASSESSEE BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE. THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS AIMI L LTD. & ORS. 229 CTR 418 (DEL) HAS HELD THAT EMPLOYEES CONTRIBUTION TO PF SHOULD BE ALLOWED AS DEDUCTION WHICH IS PAID ON OR BEFORE THE DUE DATE OF FILING T HE RETURN OF INCOME U/S 139 OF THE ACT. THE HONBLE CALCUTTA HIGH COURT HAS ALSO TAKE N THE VIEW THAT EMPLOYEES CONTRIBUTION TO PF PAID ON OR BEFORE THE DUE DATE O F FILING THE RETURN OF INCOME U/S 139(1) OF THE ACT SHOULD BE ALLOWED AS DEDUCTION. I N THIS REGARD THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF M/S. AKZ O NOBEL INDIA LTD. VS CIT IN ITA 110 OF 2011 ORDER DATED 14.06.2016 AND IN THE CASE OF CIT VS VIJAYSHREE LTD., OF THE HONBLE CALCUTTA HIGH COURT IN GA NO.2607 OF 2011 O RDER DATED 06.09.2011 WAS FILED BEFORE US. IN THE ORDER IN THE CASE OF VIJAY SHREE LTD., (SUPRA), THE HONBLE CALCUTTA HIGH COURT HELD AS FOLLOWS : 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.1448/KOL/2014-M/S. JAGDAMBA INDUSTRIES LTD. A.Y.2009-10 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 ARE OF THE VIEW THAT THE CLAIM FOR DEDUCTION AS MADE BY TH E ASSESSEE HAS TO BE ALLOWED. WE THEREFORE ALLOW THE APPEAL OF THE ASSESSEE. 7. IN THE RESULT, APPEAL BY THE ASSESSEE IS ALLO WED. O RDER PRONOUNCED IN THE OPEN COURT ON 08.03.2017. SD/- SD/- [DR.A.L.SAINI] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 08.03.2017. [RG PS] COPY OF THE ORDER FORWARDED TO: 1.M/S.JAGDAMBA INDUSTRIES LTD., 8, M.D.ROAD, 4 TH FLOOR, SUITE NO.15, KOLKATA-700007. 2.A.C.I.T., CENTRAL CIRCLE-XXX, KOLKATA.. 3. CIT(A)-CENTRAL-III, KOLKATA. 4. CIT-CENTRAL-III, KOLKATA. 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER, ASST. REGISTRAR, ITAT, KOLKATA BENCHES ITA NO.1448/KOL/2014-M/S. JAGDAMBA INDUSTRIES LTD. A.Y.2009-10 4