INDER SINGH, JIND V. DCIT/ITO Ward-2, Jind

ITA 268/CHANDI/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 7173 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2018-2019
• Appeal Filed On: 07-10-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA DHAR
• Section: 43B; 139; 139(1); 22

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ “एकल” च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “SMC” CHANDIGARH ी संजय गग , या यक सद य BEFORE: SH. SANJAY GARG, JUDICIAL MEMBER आयकर अपील सं./ ITA No.268/CHD/2021 नधा रण वष / Assessment Year : 2018-19 Shri Inder Singh, M.S. Enterprises, Near Agro, Hansi Road, Jind. बनाम The DCIT, (CPC), ITO, Ward-2, Jind. थायी लेखा सं./PAN NO: BRNPS0490M अपीलाथ /Appellant यथ /Respondent नधा रती क! ओर से/Assessee by : Shri Sanjay Kumar Singla, Advocate राज व क! ओर से/ Revenue by : Smt. Priyanka Dhar, JCIT स ु नवाई क! तार&ख/Date of Hearing : 01.12.2021 उदघोषणा क! तार&ख/Date of Pronouncement : 01.12.2021 Hearing through Video Conferencing आदेश/ORDER T h e p r e s e n t a p p e a l h a s b e e n f i l e d b y t h e a s s e s s e e ag a i n s t t h e o r d e r o f t h e C o m m i s s i o n e r o f I n c o m e T a x ( A p p e a l s ) , N a t i o n a l F a c e l e s s A p p e a l C e n t r e ( N F A C ) , D e l h i , ( i n s h o r t r e f e r r e d t o a s C I T (A ) d a t e d 1 1 . 0 8 . 2 0 2 1 r e l a t i n g t o A . Y . 2 0 1 8 - 1 9 , p a s s e d u / s 2 5 0 o f t h e I n co m e T a x A c t , 1 9 6 1 ( h e r e i n a f t e r r e f e r r e d t o a s “ A c t ” ) . 2 . T h e s o l i t a r y i s s u e i n t h e p r e s e n t a p p e a l r e l a t es t o t h e a d d i t i o n m a d e t o t h e i n c o m e o f t h e a s s e s s e e i n t h e i n t i m a t i o n m a de u / s 1 4 3 ( 1 ) o f t h e A c t , b y d i s a l l o w i n g d e l a y e d p a y m e n t s o f e m p l o y e e s c o n t r ib u t i o n t o E S I a n d P F ITA -268/CHD/2021 A.Y. 2018-19 Page 2 of 4 a m o u n t i n g t o R s . 3 7 , 0 8 , 7 3 5 / - b y i n v o k i n g t h e p r o v i s io n s o f s e c t i o n 3 6 ( l ) ( v a ) o f t h e A c t . 3 . T h e L d . C o m m i s s i o n e r o f I . T a x ( A ) u p h e l d t h e a d di t i o n o n t h e b a s i s o f t h e a m e n d m e n t e f f e c t e d b y t h e F i n a n c e A c t , 2 0 2 1 , t o s e c t i o n 4 3 B o f t h e A c t b y i n s e r t i o n o f E x p l a n a t i o n - 5 a n d t o s e c t i o n 3 6( l ) ( v a ) o f t h e A c t b y i n s e r t i o n o f E x p l a n a t i o n - 2 , b o t h t o t h e e f f e c t t h a t d u e d a t e f o r p a y m e n t o f e m p l o y e e s ' c o n t r i b u t i o n t o E S I a n d P F , f o r t h e p u r po s e o f c l a i m i n g d e d u c t i o n o f t h e s a i d a m o u n t a s p e r t h e p r o v i s i o n s o f s e c t i o n 3 6 ( l ) ( v a ) o f t h e A c t w a s n o t g o v e r n e d b y s e c t i o n 4 3 B s t i p u l a t i n g t h e d u e d a t e t o b e t i l l t h e f i l i n g o f r e t u r n o f i n c o m e u / s 1 3 9 ( 1 ) o f t h e A ct , m e a n i n g t h e r e b y t h e e m p l o y e e s ' c o n t r i b u t i o n t o E S I a n d P F w a s t o b e p a id b y d u e d a t e s p e c i f i e d i n t h e i r r e s p e c t i v e A c t s f o r t h e p u r p o s e o f c l a i m i ng d e d u c t i o n t h e r e o f . T h e L d . C I T ( A ) h e l d t h a t t h e s a i d a m e n d m e n t t o b e c l a r i fi c a t o r y a n d h e n c e r e t r o s p e c t i v e i n a p p l i c a t i o n . A c c o r di n gl y , t h e c on te nt i o n of t he Ld . C ou n s e l f or th e a s s e s s e e t h a t t h e i s s ue a l re a d y s t o od de c i de d i n i t s f a vo u r b y t h e H o n ' b l e J u r i s d i c t i o n a l H i g h C o u r t i n t h e c a s e of CI T v s . M / s La k ha n i R u b b e r U d y o g ( P ) Lt d I T A N o . 21 5 o f 2 0 1 0 d t 22 . 0 9. 2 0 1 5 & C IT v s N u c he m Lt d ( 20 15 ) 3 7 1 I T R 16 4( P& H ) , w a s b r u s he d a s i d e a nd t he a d d i t i o n u p he l d . 4 . T h i s i s s u e h a s b e e n d e a l t w i t h a n d a d j u d i c a t e d by t h e I T A T i n a n u m b e r o f c a s e s , c o n s i s t e n t l y r u l i n g i n f a v o u r o f th e a s s e s s e e , h o l d i n g t h a t t h e a m e n d m e n t t o s e c t i o n 4 3 B o f t h e A c t b y i n s e r t i on o f E x p l a n a t i o n - 5 a n d t o s e c t i o n 3 6 ( l ) ( v a ) o f t h e A c t b y i n s e r t i o n o f E x pl a n a t i o n - 2 , b y t h e F i n a n c e A c t 2 0 2 1 i s p r o s p e c t i v e a n d t h e i s s u e o t h e rw i s e s t a n d s d e c i d e d b y ITA -268/CHD/2021 A.Y. 2018-19 Page 3 of 4 t h e j u r i s d i c t i o n a l h i g h c o u r t i n f a v o u r o f t h e a s s es s e e . I n t h e c a s e o f A j a y P i p l a n i V s A s s i s t a n t D i r e c t o r o f I n c o m e T a x , C P C , Be n g a l u r u i n I T A N o . 1 1 4 / C H D / 2 0 2 1 o r d e r d a t e d 0 4 . 1 0 . 2 0 2 1 t h e i s s u e h a s b ee n a d j u d i c a t e d a t p a r a 5 t o 7 o f t h e o r d e r a s u n d e r : “5. We have heard both the parties. It is not denied that the employees contribution to ESI and PF was allowable and claimed as deduction by the assessee on the strength of various decisions of the jurisdictional High Court holding contributions deposited by the due date of filing of return of income u/s 139(1) of the Act as allowable. The Revenue has disallowed the same in the impugned year by applying the amendment made by Finance Act 2021 to section 36(l)(va) and 43B of the Act allowing the claim of such deduction only when paid by due dates specified in their respective Acts, holding the amendment to be applicable on all pending cases post the amendment. 6. We have gone through the orders of the coordinate Benches of the ITAT cited by the Ld.Counsel for the assessee before us and have noted that it has been consistently held that the amendment to section 36(l)(va) and u/s 43B of the Act effected by the Finance Act 2021 is applicable prospectively ,reading from the Notes on Clauses at the time of introduction of the Finance Act, 2021, specifically stating the amendment being applicable in relation to assessment year 2021-22 and subsequent years. Therefore the addition, we hold, cannot be made on the strength of the amendment effected by Finance Act 2021 to section 36(l)(va)/43B of the Act. Moreover it is an admitted position that the jurisdictional High Court has in various decisions held that employees contribution to ESI & PF is allowable if paid by the due date of filing return of income u/s 139(1) of the Act. The jurisdictional High Court has held so in the following cases: 1) CIT Vs. Nuchem Limited, ITA No.323 of 2009 2) CIT Vs. Hemla Embroidery Mills Pvt. Ltd.(2014), 366 ITR167 7. In view of the above, we hold that the claim of employees contribution to ESI and PF as per section 36(l)(va) of the Act cannot be denied in the impugned year, i.e. 2019-20 on the basis of amendment made to the section by Finance Act 2021. The order of the Ld.CIT(A) upholding the said disallowance to the tune of Rs. 18,21,088/- is therefore set aside and the AO is directed to allow the claim of the assessee.” O n s i m i l a r l i n e s t h e i s s u e h a s b e e n a d j u d i c a t e d i n f a v o u r o f t h e a s s e s s e e i n t h e c a s e o f M / s . J u p i t e r A q u a L i n e s P v t. L t d v s D C I T , C i r c l e 6 ( 1 ) M o h a l i i n I T A N o . 8 3 / C h d / 2 0 2 1 d a t e d 2 7 t h A u g u s t 2 0 2 1 . ITA -268/CHD/2021 A.Y. 2018-19 Page 4 of 4 5 . I n v i e w o f t h e a f o r e s t a t e d d e c i s i o n s o f t h e I T A T, t h e r e f o r e t h e c o n t e n t i o n o f t h e L d . D R b e f o r e u s t h a t t h e a m e n d m e nt t o s e c t i o n 3 6 ( 1 ) ( v a ) o f t h e A c t i s r e t r o s p e c t i v e i s d i s m i s s e d . A l s o s i n ce n o f a c t s d i s t i n g u i s h i n g t h e p r e s e n t c a s e s f r o m t h o s e d e c i d e d b y t h e I T A T h av e b e e n p o i n t e d o u t b y t h e L d . D R b e f o r e u s a n d a d m i t t e d l y t h e a m o u n t s o f e m p l o y e e s ’ c o n t r i b u t i o n t o E S I a n d P F s t o o d p a i d b e f o r e t h e d ue d a t e o f f i l i n g o f r e t u r n o f i n c o m e , t h e i s s u e o f d i s a l l o w a n c e o n a c co u n t o f d e l a y e d p a y m e n t s o f e m p l o y e e s ’ c o n t r i b u t i o n t o E S I a n d P F is s q u a r e l y c o v e r e d b y t h e a f o r e s a i d d e c i s i o n s , f o l l o w i n g w h i c h t h e d i s a l lo w a n c e m a d e o f E S I / P F e m p l o y e e s ’ c o n t r i b u t i o n u / s 3 6 ( 1 ) ( v a ) a m o u n t i n g t o R s . 3 7 , 0 8 , 7 3 5 / - i s d e l e t e d . 6 . I n t h e r e s u l t , t h e a p p e a l o f t h e a s s e s s e e i s a l lo w e d . Order pronounced in open court on 01.12.2021. S d / - (संजय गग ) ( SANJAY GARG ) या यक सद य/ Judicial Member Poonam” आदेश क琉 灹ितिलिप अ灡ेिषत/ Copy of the order forwarded to : 1. अपीलाथ牸/ The Appellant 2. 灹瀄यथ牸/ The Respondent 3. आयकर आयु猴/ CIT 4. आयकर आयु猴 (अपील)/ The CIT(A) 5. िवभागीय 灹ितिनिध, आयकर अपीलीय आिधकरण, च瀃डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड榁 फाईल/ Guard File 7. आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar