Suryas Managements Services , Secunderabad V. Deputy Commissioner of Income Tax ,Circle-10(1), Hyderabad

ITA 364/Hyd/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6613 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2018-2019
• Appeal Filed On: 14-09-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 43B; 143(1); 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”: HYDERABAD (THROUGH VIRTUAL CONFERENCE) B EFORE SH RI SA TBEER SING H GODA RA, JU DI CIA L MEM BER AND SHR I L AXMI PR AS A D SAHU , AC COUNT ANT MEMBE R ITA Nos. 363, 364 & 365/Hyd/2021 Assessment Years: 2018-19 & 2019-20 Suryas Managements Services, Secunderabad. PAN – ABHFS 5557Q Vs. Dy. Commissioner of Income-tax, Circle – 10(1), Hyderabad. (Appellant) (Respondent) Assessee by: Shri Bhanu Narayan Rao Revenue by: Smt. Matta Padma Date of hearing: 08/12/2021 Date of pronouncement: 10/12/2021 O R D E R PER L.P. SAHU, A.M.: These appeals filed by the assessee are directed against CIT(A)’s separate orders for AYs 2018-19 and 2019-20 involving proceedings u/s 143(3)/154 of the Income Tax Act, 1961. 2. The only issue involved in these appeals is that the addition towards employees’ contribution to PF and ESI on the ground of late payment of the same. ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 2 -: 3. The facts as taken from AY 2018-19 are that the assessee firm filed its return of income u/s 139(1) on 22/09/2018 for the AY 2018-19 declaring a total income of Rs. 96,77,679/- and claimed a refund of Rs. 17,38,330/-. The order u/s 143(1) was passed by the CPC in which the AO had assessed total income at Rs. 2,04,79,431/- by making addition of Rs. 1,08,01,752/- on account of disallowance of late payment of employee’s contribution of PF and ESI u/s 36(1)(va) of the Act. 4. When the assessee preferred an appeal before the CIT(A), the CIT(A) confirmed the disallowance made by the AO. 5 We have considered the rival submissions and perused the material on record as well as gone through the orders of revenue authorities. The assessee submitted before the lower authorities that the employees’ contribution to PF & ESI paid after the due date, but, before the due date of filing the return of income. Therefore, the issue has been settled that if the assessee has paid the PF and ESI payments before the due date of filing of return income u/s 139(1) of the Act, no disallowance is warranted as held by the coordinate bench of the ITAT Hyderabad in case of ITA No. 2197/Hyd/2017 for Assessment Year: 2013-14, in case of Value Momentum Software Services ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 3 -: Private Limited, Vs Deputy Commissioner of Income Tax, in which, it was held as under: “5. Next comes the latter issue of Section 43B disallowance of Rs.8,11,648/- pertaining to employees provident fund. It is not in dispute that learned lower authorities held that the same had to be deposited before the due date prescribed in the corresponding statute than the due date for filing Section 139(1) return. The Revenue’s case in tune thereof relies on Section 36(va) read with explanation thereto that it is not Section 43B but the former provision which is applicable in such an instance. We find no merit in the Revenue’s foregoing stand. We take note of the explanatory memorandum to the Finance Act, 2021 proposing amendment in both Section 36(va) as well as Section 43B by inserting corresponding Explanations that although the impugned employees provident fund comes under the former provision only, the same is applicable from 01-04-2021 onwards. Meaning thereby that the legislature itself has condoned the impugned default before 01-04-2021. We thus delete the impugned employees provident fund disallowance of Rs.8,11,648/- for this precise reason alone. Necessary computation to follow as per law.” 5.1 Respectfully, following the above judgement of the co- ordinate bench of Tribunal, we delete the addition confirmed by the ld. CIT (A) on this issue in all the appeals under consideration. Accordingly, the grounds raised by the assessee on this is allowed in all the appeals. ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 4 -: 6. In the result, appeal of the assessee is allowed in above terms. A copy of this common order be placed in the respective case files. Pronounced in the open court on 10 th December, 2021. Sd/- Sd/- (S.S. GODARA) (L. P. SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 10 th December, 2021. ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 5 -: ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 6 -: ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 7 -: ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 8 -: ITA Nos. 363 to 365/Hyd/2021 S u r y a s M a n a g e m e n t s S e r v i c e s , Sec’bad. :- 9 -: kv Copy to : 1 Suryas Managements Services, 3-6-175, Flat No. 5, Krupa Apartments, Shanthi Bhavan, West Maredpally, Secunderabad. 2 DCIT, Circle – 10(1), IT Towers, AC Guards, Hyderabad – 500 004. 3 CIT(A), NFAC, Delhi 4 ITAT, DR, Hyderabad. 5 Guard File.