Mody Autocorp Private Limited , Secunderabad V. Deputy Commissioner of Income Tax ,Circle-5(1), Hyderabad

ITA 478/Hyd/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 0500 (ITAT-HYDERABAD)
• Duration Of Justice: 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-01-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2018-2019
• Appeal Filed On: 21-11-2021
• 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 No. 478/Hyd/2021 Assessment Year: 2018-19 Mody Autocorp Pvt. Ltd., Secunderabad. PAN – AAJCM0293M Vs. Dy. Commissioner of Income-tax, Circle – 5(1), Hyderabad. 0(Appellant) (Respondent) Assessee by: Shri Darshan Jakharia Revenue by: Shri Rohit Mujumdar Date of hearing: 05/01/2022 Date of pronouncement: 06/01/2022 O R D E R PER BENCH.: This appeal filed by the assessee is directed against CIT(A)’s National Faceless Appeal Centre (NFAC) order for AY 2018-19 involving proceedings u/s 143(1) of the Income Tax Act, 1961. 2. The only issue involved in this appeal is that the addition towards employees’ contribution to PF and ESI on the ground of late payment of the same. ITA No. 478/Hyd/2021 M o d y A u t o c o r p P v t . L t d . , Sec’bad. :- 2 -: 3. The facts of the case are that the assessee a private limited company filed its return of income for the AY 2018- 19 on 30/10/2018 declaring total income of Rs. 81,84,290/-, which was processed u/s 143(1) by DCIT, CPC and an intimation u/s 143(1) was passed by making an addition of Rs. 7,12,545/- towards disallowance for delay in payment of employees contribution to PF and ESI rejecting the submission of the assessee that the amounts were paid well within the due date for filing of return of u/s 139(1) and hence allowable as deduction u/s 43B. 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 No. 478/Hyd/2021 M o d y A u t o c o r p P v t . L t d . , 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 and accordingly, the grounds raised by the assessee on this issue is allowed. ITA No. 478/Hyd/2021 M o d y A u t o c o r p P v t . L t d . , Sec’bad. :- 4 -: 6. In the result, appeal of the assessee is allowed in above terms. Pronounced in the open court on 6 th January, 2022. Sd/- (S.S. GODARA) (L. P. SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 6 th January, 2021. Copy to : 1 Mody Autocorp Pvt. Ltd., H.No. 5-3-372, R.P. Road, Secunderabad – 500 003. 2 DCIT, Circle – 5(1), Hyderabad. 3 CIT(A), NFAC, Delhi 4 ITAT, DR, Hyderabad. 5 Guard File.