M/s. Gorakhnath Construction Pvt. Ltd., Rourkela V. ACIT, Rourkela Circle, Rourkela

ITA 195/CTK/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4344 (ITAT-CUTTACK)
• Duration Of Justice: 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 17-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K PRADHAN
• Assessee Lawyers: P R MOHANTY
• Keywords: Business expenditure
• Section: 43B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI N.S.SAINI, AM & SHRI PAV AN KUMAR GADALE, JM ITA NO. 1 95 /CTK/201 7 ( / ASSESSMENT YEAR : 20 12 - 20 13 ) M/S GORAKHNATH CONSTRUCTION PVT. LT D. E - 42, KOEL NAGAR, ROURKELA VS. ACIT, ROURKELA CIRCLE, ROURKELA ./ ./ PAN/GIR NO. : A A BCG 4382 R ( / APPELLANT ) .. ( / RESPONDENT ) /AS SESSEE BY : SHRI P.R.MOHANTY , AR /REVEN UE BY : SHRI D.K.PRADHAN, D R / DATE OF HEARING : 01 / 0 3 /201 8 / DATE OF PRONOUNCEMENT 06 / 0 3 /201 8 / O R D E R PER SHRI N.S.SAINI , A M : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A), SAMBA LPUR , DATED 18 .01.2017 . 2. GROUNDS NO.1 & 4 OF THE APPEAL ARE GENERAL IN NATURE AND, HENCE, REQUIRE NO SEPARATE ADJUDICATION BY US. 3 . IN GROUND NO.2 OF THE APPEAL THE GRIEVANCE OF THE ASSESSEE IS THAT THE CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE FOR EM PLOYEES CONTRIBUTION TO PF U/S.36(1)(VA) OF THE INCOME TAX ACT, 1961 OF RS. 18,23,036/ - AND EMPLOYEES CONTRIBUTION TO ESIC OF RS.3,35,035/ - , AGGREGATING TO RS.21,58,071/ - ON THE GROUND THAT THE SAME WAS NOT DEPOSITED WITHIN THE DUE DATE PRESCRIBED UNDER TH E RESPECTIVE ACT. 4. BRIEF FACTS OF THE CASE ARE THAT THE AO OBSERVED THAT THE ASSESSEE HAS NOT DEPOSITED EMPLOYEES CONTRIBUTION TO PROVIDENT FUND OF RS.18,23,036/ - AND EMPLOYEES CONTRIBUTION TO ESIC OF RS.3,35,035/ - ITA NO. 1 9 5 /1 7 2 AGGREGATING TO RS.21,58,071/ - WITHIN THE DUE DATE PRESCRIBED UNDER THE RESPECTIVE ACT, THEREFORE, HE ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE U/S.36(1)(VA) R.W.S.2(24)(X) OF THE ACT. 5. ON APPEAL THE CIT(A) CONFIRMED THE ACTION OF AO BY FOLLOWING THE DECISION OF HONBLE GUJARAT HIG H COURT IN THE CASE OF CIT VS. GUJARAT STATE ROAD TRANSPORT CORPORATION [2014] 366 ITR 170 (GUJARAT). 6. BEFORE US, THE AR OF THE ASSESSEE SUBMITTED THAT IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RAJASTHAN STATE BEVERAGES CORPORATION LTD., [2017] 84 TAXMANN.COM 185 (SC), NO DISALLOWANCE OF DEDUCTION FOR EMPLOYEES CONTRIBUTION TO PF & ESIC IS TO BE MADE WHERE THE AMOUNT IS DEPOSITED BY THE ASSESSEE WITHIN THE TIME PRESCRIBED FOR FILING RETURN OF INCOME U/S.139(1) OF THE ACT. 7 . THE DR COULD NOT CONTROVERT THE ABOVE SUBMISSION OF THE AR OF THE ASSESSEE. 8 . AFTER HEARING RIVAL SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, W E FIND THAT IT IS NOT IN DISPUTE THAT THE ASSESSEE DEPOSITED EMPLOYEES CONTRIBUTION TO PROVIDENT FUND OF RS.18,23 ,036/ - AND EMPLOYEES CONTRIBUTION TO ESIC OF RS.3,35,035/ - AGGREGATING TO RS.21,58,071/ - WITHIN THE DUE DATE PRESCRIBED U/S.139(1) OF THE ACT . THE ADDITION WAS MADE ON THE GROUND THAT THE EMPLOYEES CONTRIBUTION TO PF AND ESIC WAS NOT DEPOSITED WITHIN THE TIME PRESCRIBED UNDER THE P.F.ACT . WE FIND THAT NO DISALLOWANCE CAN BE MADE FOR DEDUCTION OF THE SAME U/S.36(1)(VA) R.W.S.2(24)(VA) OF THE ACT IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RAJASTHAN STATE BEVERAGES CORPORATION LTD., [201 7] 84 TAXMANN.COM 185 (SC), WHERE IT WAS HELD AS UNDER : - ITA NO. 1 9 5 /1 7 3 SECTION 43B, READ WITH SECTION 36(1)(VA), OF THE INCOME - TAX ACT, 1961 - BUSINESS DISALLOWANCE - CERTAIN DEDUCTIONS TO BE ALLOWED ONLY ON ACTUAL PAYMENT (PF AND ESI CONTRIBUTION) - HIGH COURT BY IM PUGNED ORDER HELD THAT AMOUNT CLAIMED ON PAYMENT OF PF AND ESI HAVING BEEN DEPOSITED ON OR BEFORE DUE DATE OF FILING OF RETURNS, SAME COULD NOT BE DISALLOWED UNDER SECTION 43B OR UNDER SECTION 36(1)(VA) - WHETHER SLP AGAINST SAID IMPUGNED ORDER WAS TO BE D ISMISSED - HELD, YES [PARA 2] [IN FAVOUR OF ASSESSEE] 9 . RESPECTFULLY FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RAJASTHAN STATE BEVERAGES CORPORATION LTD. (SUPRA), WE SET ASIDE THE ORDERS OF LOWER AUTHORITIES AND DELETE THE ADDITION OF RS. 21,58,071/ - AND ALLOW TH IS GROUND OF APPEAL OF THE ASSESSEE. 10. GROUND NO.3 OF THE APPEAL OF THE ASSESSEE READS AS UNDER : - 3. FOR THAT, THE DISALLOWANCE OF EXPENSES AMOUNTING TO RS.32,000/ - CLAIMED TOWARDS DONATION BY THE LD. AO IS ILLEGAL, UNJUSTI FIED AND UNWARRANTED AND DEVOID OF ANY MERIT, BEING GENUINE BUSINESS EXPENDITURES, BEING INTRINSIC AND INSEGGREGABLE NEXUS WITH THE WORK UNDERTAKEN, DESERVES TO BE ALLOWED IN TOTO . 11. AT THE TIME OF HEARING THE AR OF THE ASSESSEE SUBMITTED THAT HE IS NO T PRESSING THIS GROUND OF APPEAL. HENCE, THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED FOR WANT OF PROSECUTION. 12 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 06 / 03 /201 8 . SD/ - ( PAVAN KUMAR GADALE ) SD/ - (N. S. SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK ; DATED 06 / 03 /2018 . . / PKM , SENIOR PRIVATE SECRETARY ITA NO. 1 9 5 /1 7 4 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - M/S GORAK HNATH CONSTRUCTION PVT. LTD. E - 42, KOEL NAGAR, ROURKELA 2. / THE RESPONDENT - ACIT, ROURKELA CIRCLE, ROURKELA 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//