Dnyaneshwar Keeshavrao Raghude, Paithan, Aurangabad V. Deputy Commissioner of Income-Tax, CPC, Bengaluru

ITA 349/PUN/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5651 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 31-08-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 43B; 143(1); 139(1); 43

Judgement Text

आयकरअपीलीयअधिकरण“ए”न्यायपीठपुणेमें। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकरअपऩलसं. / ITA No.349/PUN/2021 निर्धारणवषा / Assessment Year : 2018-19 Shri Dnyaneshwar Keshavrao Raghude Naigaon, Post – Khandewadi, Taluka – Paithan, Dist - Aurangabad PAN: ALVPR7153B Vs DCIT, CPC, Bangalore Appellant/ Assessee Respondent /Revenue Assessee by None Revenue by Shri Ramnath P Murkunde – DR Date of hearing 14/09/2022 Date of pronouncement 19/09/2022 आदेश/ ORDER PER BENCH: This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income Tax(Appeals), (NFAC), dated 26.07.2021 emanating out of proceedings under section 143(1) of the Income-tax Act, 1961 (hereinafter also called as „the Act‟) for the Assessment Year 2018-19. The assessee has raised the following grounds of appeal: 1. The learned CIT(A) erred in not considering the act that amendment made in the first proviso to the section 43B vide Finance Act, 2003 regarding allowability of expenditure of payment of contribution by the employer towards employees welfare funds before filing of Income Tax Return u/s 139(1) for that previous year is applicable in case of payment of employer's ITA No.349/PUN/2021 for A.Y. 2018-19 Shri Dnyaneshwar Keshavrao Raghude vs.DCIT 2 contribution as well as employees' contributions towards the employees welfare fund. Accordingly, the appellant prays before Your Honour to direct the Ld AO to delete the addition of Rs.7,13,908/- confirmed by Ld CIT(A) as disallowance of expenditure u/s 36(1)(va) for delay in deposition of employees’ contribution towards employees’ welfare funds within due date prescribed under respective acts. 2. The learned CIT (A) erred in not following the judgements of jurisdictional high court in similar matter in which Hon'ble Bombay High Court held that the amendment made in the first proviso to the section 43 B vide Finance Act, 2003 regarding allowability of expenditure of payment of contribution by the employer towards employees welfare funds before filing of Income Tax Return u/s 139(1) for that previous year is applicable in case of payment of employer's contribution as well as employees' contributions towards the employees welfare fund. Accordingly, in view of the judgments of Hon'ble Bombay High Court in following cases, the appellant prays before Your Honour that the addition of Rs.7,13,908/- kindly be deleted. The CIT (Central), Pune Vs M/s Ghadge Patil Transports Ltd (ITA no. 1002 of 2012 and ITA no. 1034 of 2012) (Bombay HC) CIT -4, Mumbai Vs M/s Hindustan Organics Chemicals Ltd (ITA no. 399 of 2012) (Bombay HC) 3. The Hon'ble Co-ordinated Bench has followed the above- mentioned judgments of Hon'ble Bombay High Court in following cases: Dy. Commissioner of Income Tax, Circle-8, Pune Vs Shri. Pradeep Bakru Patil (ITA no. 1769/PN/2013) M/s Ata Freightline (India) Pvt Ltd Vs ITO, Ward 1(4), Pune (ITA no. 2059/PN/2014) Accordingly, the appellant prays before Your Honour that kindly delete the addition of Rs.7,13,908/- confirmed by the Ld CIT(A). ITA No.349/PUN/2021 for A.Y. 2018-19 Shri Dnyaneshwar Keshavrao Raghude vs.DCIT 3 2. In the present appeal, the question involved is allowability of employees‟ contribution of ESIC and PF, which was deposited beyond time mentioned in the respective Statutes but before filing income tax return u/s 139(1) of the Act. 3. No one has appeared on behalf of the appellant-assessee. We heard ld. DR, perused the records. In this case, the DCIT (CPC), Bengaluru vide an order u/s 143(1) of the Act dated 08.06.2019 disallowed an amount of Rs.17,26,605/-. Out of Rs.17,26,605/-, the amount of Rs.7,13,908/- was a delayed payment of employees‟ contribution towards ESI/PF. But the amounts were paid before due date of filing return. 4. From the plain reading of the order u/s 143(1), it is not clear whether any opportunity was provided before making the disallowance by the DCIT (CPC), Bengaluru. Aggrieved by the same, an appeal was filed before the CIT(A). The CIT(A) dismissed the appeal of assessee. 5. Hon‟ble Rajasthan High Court in the case of Rajasthan State Beverages Corpn. Ltd vide order dated 4/8/216 has held as under: ITA No.349/PUN/2021 for A.Y. 2018-19 Shri Dnyaneshwar Keshavrao Raghude vs.DCIT 4 Quote “This court in the aforesaid case has also allowed the claim of the assessee, in so far as payment of PF & ESI etc. is concerned, on the finding of fact that the amounts in question were deposited on or before the due date of furnishing of the return of income and taking in consideration judgment of this Court in CIT v. State Bank of Bikaner & Jaipur [2014] 363 ITR 70/43 taxmann.com” Unquote 6. The SLP filed against the said decision has been dismissed by Hon‟ble SC. 7. Hon‟ble Jurisdictional High Court held in the case of CIT vs Ghatge Patil Transports Ltd, IT APPEAL NOS. 1002 & 1034 OF 2012 vide order dated 14/10/2014 as under : Quote , “ In this manner, the amendment provided by Finance Act, 2003 put on par the benefit of deductions of tax, duty, cess and fee on the one hand with contributions to various Employees' Welfare Funds on the other. All this came up for consideration before the Hon'ble Supreme Court in the case of Alom Extrusions Ltd. (supra). The Tribunal in the case at hand relied upon the said judgment. There is no reason to fault the order passed by the Tribunal. We are of the view that the decision of the Supreme Court in Alom Extrusions Ltd. (supra) applies to employees' contribution as well as employers' ITA No.349/PUN/2021 for A.Y. 2018-19 Shri Dnyaneshwar Keshavrao Raghude vs.DCIT 5 contribution. Question Nos.2, 3 & 4 are accordingly answered in favour of the assessee and against the revenue. ” Unquote. Thus respectfully following the Hon‟ble High Courts it is held that the payment of employee‟s contribution beyond the due date mentioned in the relevant statute but before the due date of filling the return of income u/s 139(1) is allowable expenditure. 8. In the result, the assessee‟s appeal is allowed. Order pronounced in the open Court on 19 th September, 2022. Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पपणे / Pune; ददिधंक / Dated : 19 th September, 2022 GCVSR आदेशकीप्रनिनलनपअग्रेनषि / Copy of the Order forwarded to : 1. अपऩलधर्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The concerned CIT(A). 4. The concerned Pr. CIT. 5. नवभधगऩयप्रनिनिनर्,आयकरअपऩलऩयअनर्करण, “ए” बेंच, पपणे / DR, ITAT, “A” Bench, Pune. 6. गधर्ाफ़धइल / Guard File. आदेशधिपसधर / BY ORDER, // TRUE COPY // Senior Private Secretary आयकरअपऩलऩयअनर्करण, पपणे/ITAT, Pune. ITA No.349/PUN/2021 for A.Y. 2018-19 Shri Dnyaneshwar Keshavrao Raghude vs.DCIT 6 S.No Details Date Initials Designation 1 Draft dictated on 15.09.2022 Sr. PS/PS 2 Final Draft placed before author 15.09.2022 Sr. PS/PS 3 Draft proposed & placed before the Second Member JM/AM 4 Draft discussed/approved by Second Member AM/AM 5 Approved Draft comes to the Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R. 11 Date of Dispatch of order