M/s. ATA Freightline (India) Pvt. Ltd., Pune V. Income-tax Officer,

ITA 2059/PUN/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1810 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 6 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 17-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNDHENDU DAS
• Section: 43B

Judgement Text

] IQ.KS ] IQ.KS ] IQ.KS ] IQ.KS IQ.KS IQ.KSIQ.KS IQ.KS IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE . . , , ' # BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.2059/PN/2014 '% % / ASSESSMENT YEAR : 2010-11 M/S. ATA FREIGHTLINE (INDIA) PVT. LTD., BUNGLOW NO.D-8, VENUS PARK, ROAD NO.2, KALYANI NAGAR, PUNE 411006 PAN NO.AAECA0859N . / APPELLANT V/S ITO, WARD - 1(4), PUNE . / RESPONDENT / ASSESSEE BY : SHRI KISHOR PHADKE / DEPARTMENT BY : SHRI SUNDHENDU DAS / ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE O RDER DATED 10-09-2014 OF THE CIT(A)-I, PUNE RELATING TO ASSES SMENT YEAR 2010-11. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED FROM THE TAX AUDIT REPOR T THAT THE ASSESSEE HAS MADE BELATED PAYMENT OF EMPLOYEES CONTRIB UTION TO PF AND ESI IN CONTRAVENTION OF THE PROVISIONS OF SECTION 36(1 )(VA) OF THE I.T. ACT, 1961. THE AO ASKED THE ASSESSEE TO EXPLAIN AS TO WHY THE AMOUNT OF RS.5,12,976/- SHOULD NOT ADDED TO THE TOTAL INCO ME / DATE OF HEARING :26.05.2016 / DATE OF PRONOUNCEMENT:27.05.2016 2 ITA NO.2059/PN/2014 DECLARED IN VIEW OF PROVISIONS OF SECTION 2(24)(X) R.W.S. 36(1)(VA). THE ASSESSEE SUBMITTED THAT SINCE THE EMPLOYEES CONTRIBUTIO N TO PF AND ESI WAS PAID BEFORE THE DUE DATE OF FILING OF THE RETURN U /S.139(1) OF THE I.T. ACT., THEREFORE, THE SAME IS AN ADMISSIBLE DEDUCTION IN VIEW OF OMISSION OF SECOND PROVISO TO SECTION 43B W.E.F., 01-04-2004. VARIOUS DECISIONS INCLUDING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. ALOM EXTRUSIONS LT. REPORTED IN 319 ITR 306 AN D THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. PAMWI TISSUES LTD. REPORTED IN 313 ITR 137 WERE RELIED UPON. 3. HOWEVER, THE AO WAS NOT SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE. ACCORDING TO HIM, THE EMPLOYEES CONTRIBUT ION AND PAYMENT THEREOF IS NOT COVERED BY SECTION 43B BUT IS GO VERNED BY THE PROVISIONS OF SECTION 36(1)(VA) R.W.S. 2(24)(X) OF THE I.T. ACT. S INCE THE CONTRIBUTIONS WERE PAID BELATEDLY, THE AO DISALLOWED AN AMO UNT OF RS.5,12,976/- AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE . 4. BEFORE THE CIT(A) THE ASSESSEE REITERATED MORE OR LES S THE SAME ARGUMENTS. RELYING ON VARIOUS DECISIONS IT WAS SUBMITTED THAT SINCE THE ASSESSEE HAS DEPOSITED THE AMOUNT BEFORE THE DUE DATE OF FILING OF THE RETURN UNDER THE PROVISIONS OF SECTION 139(1), THEREFOR E, NO DISALLOWANCE IS CALLED FOR. 5. HOWEVER, THE CIT(A) WAS NOT SATISFIED WITH THE EXPLANATIO N GIVEN BY THE ASSESSEE AND UPHELD THE ACTION OF THE AO. WHILE D OING SO, HE HELD THAT DEDUCTION FOR EMPLOYEES CONTRIBUTION DEPOSITED BEYOND THE DUE DATE PRESCRIBED UNDER THE PF AND ESI ACT CANNOT BE ALLOWED EVEN IF THE PAYMENTS ARE MADE WITHIN THE FINANCIAL YEAR OR BEFOR E THE DUE DATE OF FILING OF THE RETURN OF INCOME. DISTINGUISHING THE VAR IOUS DECISIONS CITED BEFORE HIM AND RELYING ON THE DECISION OF TH E SPECIAL 3 ITA NO.2059/PN/2014 BENCH OF THE TRIBUNAL IN THE CASE OF JCIT VS. ITC LTD. REP ORTED IN 112 ITD 57 AND CERTAIN OTHER DECISIONS THE CIT(A) HELD THAT THE ADDITION MADE BY THE AO IN THE CASE OF BELATED PAYMENT OF PF CON TRIBUTION OF EMPLOYEES AMOUNTING TO RS.5,12,976/- IS JUSTIFIED. 6. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 7. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET FILED A COPY OF THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS . GHATGE PATIL TRANSPORTS VIDE INCOME TAX APPEAL NO.1002/2012 AND 1034/2012 ORDER DATED 14-10-2014 AND SUBMITTED THAT THE HONBLE HIGH COURT HAS HELD THAT THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF ALOM EXTRUSIONS LTD. (SUPRA) APPLIES TO EMPLOYEES CONTRIBUTION AS WELL AS EMPLOYERS CONTRIBUTION AND THERE FORE BOTH THE EMPLOYEES AND EMPLOYERS CONTRIBUTION ARE COVERED UNDER THE AMENDMENT TO SECTION 43B. ACCORDINGLY, THE HONBLE HIGH COURT UPHELD THE DECISION OF THE TRIBUNAL THAT PAYMENTS THEREOF ARE SUBJECT TO BENEFITS OF SECTION 43B. REFERRING TO THE DECISION OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF DCIT VS. SHRI PRADEEP BARK U PATIL VIDE ITA NO.1769/PN/2013 ORDER DATED 10-09-2014 HE SUBMITT ED THAT THE TRIBUNAL IN THE SAID DECISION HAS UPHELD THE DECISION OF THE CIT(A) DELETING THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF DE LAYED PAYMENT OF EMPLOYEES CONTRIBUTION TO PF AND ESI. HE ACC ORDINGLY SUBMITTED THAT THE ISSUE STANDS COVERED IN FAOVUR OF THE ASSESSEE SINCE ADMITTEDLY THE ASSESSEE HAS DEPOSITED THE EMPLOYEES C ONTRIBUTION TO PF BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME U/S.139(1). 8. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HA ND HEAVILY RELIED ON THE ORDER OF THE CIT(A). 4 ITA NO.2059/PN/2014 9. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SID ES, PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIO US DECISIONS CITED BEFORE US. THERE IS NO DISPUTE TO THE FACT THAT T HE ASSESSEE IN THE INSTANT CASE HAS DEPOSITED THE EMPLOYEES CONTRIBU TION TO PF AND ESI BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME A LTHOUGH THE SAME WERE DEPOSITED AFTER THE DUE DATE PRESCRIBED UNDE R THE RELEVANT ACT. THE COORDINATE BENCHES OF THE TRIBUNAL FOLLOWING THE D ECISIONS OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GHATGE P ATIL TRANSPORTS LTD. (SUPRA) AND IN THE CASE OF CIT VS. HINDUST AN ORGANICS CHEMICAL LTD. REPORTED IN 366 ITR 1 ARE CONSISTENTLY TAK ING THE VIEW THAT EMPLOYEES CONTRIBUTION TO PF AND ESI, IF PAID ON O R BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME, IS AN ALLOWABLE DED UCTION. SINCE THE ASSESSEE IN THE INSTANT CASE HAS ADMITTEDLY D EPOSITED THE EMPLOYEES CONTRIBUTION TO PF AND ESI BEFORE THE DUE DA TE OF FILING OF THE RETURN, A FACT SUBMITTED BEFORE THE AO AS WELL AS CIT (A) AND NOT CONTROVERTED BY THE REVENUE, THEREFORE, WE ARE OF THE C ONSIDERED OPINION THAT NO DISALLOWANCE ON ACCOUNT OF SUCH DELAYED PA YMENT IS CALLED FOR. WE ACCORDINGLY SET ASIDE THE ORDER OF THE CIT (A) AND DIRECT THE AO TO DELETE THE ADDITION. GROUNDS RAISED BY THE AS SESSEE ARE ACCORDINGLY ALLOWED. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27-05-2016. SD/- SD/- ( VIKAS AWASTHY ) ( R.K. PANDA ) JUDICIAL MEMBER ACCOUNTANT MEMBER IQ.KS PUNE ; # DATED : 27 TH MAY, 2016. LRH'K 5 ITA NO.2059/PN/2014 ( )'+ , / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. CIT (A) - I , PUNE 4. 5. 6. CIT-I, PUNE ' *, *, IQ.KS / DR, ITAT, B PUNE; / GUARD FILE. / BY ORDER , ' //TRUE COPY// / * / SR. PRIVATE SECRETARY *, IQ.KS / ITAT, PUNE