Shri Patel Mahendrabhai Aditbhai, Ahmedabad V. The ITO, Ward-7(2)(3), Ahmedabad

ITA 31/AHD/2018

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 7888 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 10 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 01-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.S. SHUKLA
• Section: 143(3)

Judgement Text

, ‘C’ । IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, AHMEDABAD (Convened through Virtual Court) BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SMT. MADHUMITA ROY, JUDICIAL MEMBER आयकर अपील सं./I. T. A. No . 31 /A hd /2 01 8 ( Ass e ss me nt Ye ar : 20 1 4 -15 ) Shri Patel Mahendrabhai Aditbhai D-1, Ghansh ya mn agar Shopping Centre, Nr. Noble Nagar , Kubernagar, Ah medabad 382340 / Vs. In co me- tax Of fi ce r W ar d -7 (2 )( 3), Ah me da bad यी ल ख सं./जीआइआर सं./P A N / G IR N o . : A A E H P 0 7 6 7 R (अपील Appellant) . . ( य / Respondent) अपील र स /Appellant by : None य क र स /Respondent by : Shri S. S. Shukla, Sr.DR स क र ख D ate o f He ari ng 07/10/2021 !"# क र ख /Dat e o f Pro n ou nc e men t 24/11/2021 आद श/O R D E R PER PRADIP KUMAR KEDIA - AM: The captioned appeal has been filed at the instance of the assessee against the order of the C o mmissioner of Inco me Tax (Appeals)-7, Ah medabad (CIT(A) ’ in short), dated 06.11.2017 I T A N o . 3 1 / A h d / 1 8 [ S h r i P a t e l M a h e n d r a b h a i A d i t b h a i v s . I T O ] A . Y . 2 0 1 4 - 1 5 - 2 - arising in the assess ment order dated 07.12.2016 passed by the Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY 2014-15. 2. The solitary iss ue in the present appeal is against the addition of Rs.33,95,734/- on account of late payment of Provident Fund under s.36(1)(va) of the Inco me Tax Act, 1961 (hereinafter refer r ed to as "the Act") . 3. The CIT(A) has relied upon the decision of the Hon’ble Jurisdictional High Court in the case of CIT vs. Gujarat State Road Transport Corporation [2014] 41 taxmann.co m 100 (Guj.) and rejected the a ppeal of the assessee. 4. When the matter was called for hearing, none appeared on behalf of the assessee. The matter was accordingly proceeded ex parte. 5. The learned DR , on the other hand, relied upon the order of the CIT(A) . 6. On careful perusal of case records, we find that assessee has agitated addition towards belated payment of emplo yees ’ contribution of PF under s.36(1)(va) r.w.s.2(24) o f the Act. Section 36(1)(va) provides for deduction where an y su m received by the assessee fro m its e mplo yees as contribution to any provident fund or superannuation fund or any other welfare funds found set up is deposited by the assessee in the relevant fund on or before due date. I T A N o . 3 1 / A h d / 1 8 [ S h r i P a t e l M a h e n d r a b h a i A d i t b h a i v s . I T O ] A . Y . 2 0 1 4 - 1 5 - 3 - 6.1 It is noticed that there is small dela y in depositing the e mplo yees ’ contribution to Provident Fund by the e mplo yer assessee when seen with reference to due date of accrual of salar y. It is the case of the assessee that the salary also has been disbursed belatedly on receipt of pa yments of corresponding clients and when seen with reference to the actual date of payment of salar y, no delay has occurred in depositing the emplo yees ’ contribution to Provident Fund. Thus, the assessee has tried to demonstrate before the CIT(A) that Rs.33,95,734/- towards contribution of the emplo yees to the PF has been deposited by the assessee-e mplo yer before the ‘due date’ in ter ms of interpretation rendered by the decision of the ITAT in the case of Kanoi Paper and Industries Ltd. vs. AC IT (75 TTJ 448). We observe that the decision of the Hon’ble Gujarat High Court does not apply where the pa ymen t has been made on or before the due date. The deduction under s.36(1)(va) in such case is available without any fetter s. 6.2 At this juncture, it ma y be pertinent to observe that disallowance under s.43B r.w.s. 36( 1)(va) of the Act in respect of non-payment of provident fund etc. within the due date is not intended to cover genuine and routine cases on late pa yment but only those wher e the e mplo yer has mis-utilized the funds collected fro m the assessee. 6.3 The addition/disallowance under s.43B of the Act for such delay of bare one or two da ys in depositing the emplo yees ’ provident fund would thus be wholly disproportionate to the default co mmitte d, if an y. Thus, seen fro m an y angle, the I T A N o . 3 1 / A h d / 1 8 [ S h r i P a t e l M a h e n d r a b h a i A d i t b h a i v s . I T O ] A . Y . 2 0 1 4 - 1 5 - 4 - addition/disallowance under s. 36(1)(va) r.w.s. 2(24) (x) of the Act is not justified in the instant case. 7. In the result, the captioned appeal filed by the assessee is allowed. Sd/- Sd/- (MADHUMI TA R OY) (PRADIP KUM AR KEDIA) JUDICI AL MEM BER ACC OUNTANT MEM BER A h m e d a b a d : D a t e d 2 4 / 1 1 / 2 0 2 1 True Copy S. K. SINHA ेश ! " #े" / Copy of Order Forwarded to:- &. र ज / Revenue 2. आ दक / Assessee (. सं)ं*+ आयकर आय , / Concerned CIT 4. आयकर आय , - अपील / CIT (A) /. 0 1 2ीय 3 3 *+4 आयकर अपील य अ*+कर#4 अ56द ) द / DR, ITAT, Ahmedabad 7. 2 89 : इल / Guard file. By order/आद श स 4 उप/स5 यक पंजीक र आयकर अपील य अ*+कर#4 अ56द ) द । This Order pronounced in Open Court on 24/11/2021