ITO 8(3)(3), MUMBAI V. TRICOM INDIA LTD, MUMBAI

ITA 4981/MUM/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3891 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 18-11-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 02-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACHIDANAND DUBEY
• Assessee Lawyers: ANKIT V SUDHA SHAH
• Section: 43B; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI BEFORE SHRI RAJENDRA, AM AND SHRI SANDEEP GOSAIN, J M ./ I.T.A. NO. 4981/MUM/2013 ( / ASSESSMENT YEAR: 2005-06) INCOME TAX OFFICER 8 (3) (3) ROOM NO.202, AAYAKAR BHAVAN, MK ROAD, MUMBAI-400 020. / VS. M/S. TRICOM INDIA LTD., TRICOM HOUSE, GANDHI ESTATE, A.K. ROAD, SAFED POOL, SAKINAKA, ANDHERI KURLA ROAD, MUMBAI-400 072. ./ ./PAN/GIR NO. AAACT 2807R ( /APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI SACHIDANAND DUBEY / RESPONDENT BY : SHRI ANKIT V. SUDHA SHAH / DATE OF HEARING : 18/11/2015 !'# / DATE OF PRONOUNCEMENT : 05/08/2016 $% / O R D E R PER SANDEEP GOSAIN, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE AG AINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)- 18, DATED 18 .04.2013 ON THE GROUNDS OF APPEAL MENTIONED HEREIN BELOW. 2 ITA NO. 4981/MUM/2013(A.Y. 2005-06) ITO VS. M/S. TRICOM INDIA LTD. 1) 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE DISALLOWANCE MADE U/S 2(24(X) R.W.S. 3 6(1 )(VA) OF THE INCOME-TAX ACT, 1961 TOWARDS EMPLOYEE'S CONTRIBUTION TO PF OF RS.25,42,7 82/- & ESIC OF RS.5,69,979/- MADE BEYOND THE DUE DATE AS PRESCRIBED IN THE RELEVANT L EGISLATION'. 2) 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE CIT(A) ERRED IN NOT APPRECIATING THAT EMPLOYEE'S CONTRIBUTION COLLECTED BY THE EMPLOYER IS DEEMED TO BE HIS INCOME U/S 2(24)(X) AND IS ALLOWABLE AS A DEDUCTION U/S 36(1 )(VA) ONLY IF IT IS PAID TO THE RELEVANT FUND BY THE DUE DATE AS PRESCRIBED IN THE RELEVANT LEGISLATION AND THAT THE SECTION 43B COVERS ONLY THE EMPLOYER'S CONTRIBUTION TO THE PF & ESIC AND EMPLOYEE'S CONTRIBUTION IN THIS REGARD ARE OUTSIDE ITS AMBIT.' 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE CIT(A) ERRED IN NOT APPRECIATING THAT IN THE CASE OF ALOM EXTRUSIONS LT D., THE ISSUE OF ALLOWABILITY OF EMPLOYEE'S CONTRIBUTION TO PF & ESIC MADE BEYOND DU E DATES U/S 43B VIS-A-VIS DEDUCTION U/S 2(24)(X) R.W.S. 36(1)(VA) OF THE INCO ME TAX ACT, 1961 WAS NOT ADJUDICATED BY THE APEX COURT.' 4. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE CIT(A) ERRED IN IGNORING THE RATIO LAID DOWN BY THE JUDICIAL PRONOU NCEMENTS IN DCIT VS BENGAL CHEMICALS & PHARMACEUTICALS LTD.(2011) 10 TAXMANN.C OM 26 (KOL.) AND JCIT VS ITC LTD(2008) (112 ITD 57 (KOL.) (SB), WHEREIN AFTER DI FFERENTIATING THE JUDGMENT IN THE CASE OF ALOM EXTRUSIONS LTD., IT WAS HELD THAT DEDUCTIBI LITY OF EMPLOYEE'S CONTRIBUTION PAYMENTS TO PF & ESIC IS ONLY GOVERNED BY THE PROVI SIONS OF SECTION 36(1 )(VA) AND THAT THE PROVISIONS OF SECTION 43B DO NOT APPLY TO THE I MPUGNED PAYMENTS'. 5. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE A.O. BE RESTORED. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSM ENT U/S 143(3) WAS COMPLETED ON 06.12.2007 AND LATER ON AO OBSERVED THAT THERE W AS DELAY IN DEPOSITING EMPLOYEES CONTRIBUTION OF PF AND ESIC OF RS.31,12, 761/- AND AFTER ISSUING SHOW CAUSE NOTICE AND CONSIDERING REPLY FILED BY THE ASS ESSEE, THE AO MADE DISALLOWANCE OF EMPLOYEES CONTRIBUTION ON PF AND ES IC VIDE ORDER OF ASSESSMENT DATED 06.12.2007. 3 ITA NO. 4981/MUM/2013(A.Y. 2005-06) ITO VS. M/S. TRICOM INDIA LTD. 3. AGGRIEVED BY THE ORDER OF THE AO, ASSESSEE FILED THE APPEAL BEFORE CIT(A) AND THE CIT(A) AFTER CONSIDERING THE CASE OF THE AS SESSEE ALLOWED THE APPEAL VIDE ORDER DATED 18.04.2013. 4. AGGRIEVED BY THE ORDER OF CIT(A), THE REVENUE FI LED THE PRESENT APPEAL BEFORE US ON THE GROUNDS MENTIONED HEREIN ABOVE. 5. SINCE ALL THE GROUNDS RAISED BY THE ASSESSEE ARE INTER-CONNECTED AND INTER- RELATED THEREFORE WE THOUGHT IT FIT TO DISPOSE OFF THE SAME THROUGH THE PRESENT COMMON ORDER. 5.1 WE HAVE HEARD THE COUNSELS FOR BOTH THE PARTIES ON THIS GROUND IN DETAIL AND WE HAVE ALSO PERUSED THE MATERIAL PLACED ON RECORD AS WELL AS THE ORDERS PASSED BY THE REVENUE AUTHORITIES. BEFORE WE DECIDE THE MERI TS OF THE CASE, DETAILED ORDER PASSED BY CIT(A) IS OBSERVED AND THE OPERATIVE PARA IS REPRODUCED BELOW: 1.3. I HAVE CONSIDERED THE SUBMISSIONS OF THE APP ELLANT, ORDER OF THE A.0 AND FACTS OF THE CASE CAREFULLY, IT IS NOTICED THAT THE PAYMENT TOWARDS CONTRIBUTION OF PF AND ESIC HAS BEEN MADE BY THE APPELLANT AS UNDER :- XXXXXX THE DUE DATE FOR FILING OF RETURN IN THIS CASE WAS 31.10.2005. THE ASSESSEE HAS FILED THE RETURN ON 31.10.2005 I.E. WITHIN THE PRES CRIBED TIME. FROM THE PERUSAL OF THE ABOVE STATEMENTS, IT IS CLE AR THAT THE CONTRIBUTION TO PF AND ESIC PAYMENTS HAVE BEEN DEPOSITED IN THE GOVERN MENT ACCOUNT BEFORE FILING RETURN OF INCOME. THE FACTS OF THE CASE ARE SQUAREL Y COVERED BY THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. ALOM E XTRUSIONS LTD. 319 ITR 306 4 ITA NO. 4981/MUM/2013(A.Y. 2005-06) ITO VS. M/S. TRICOM INDIA LTD. WHERE IT IS HELD THAT PAYMENTS MADE BEFORE FILING O F THE RETURN OF INCOME AND WITHIN THE GRACE PERIOD IS ALLOWABLE DEDUCTION. KEE PING IN VIEW THE FACTS AND CIRCUMSTANCES, THE ADDITION MADE BY THE A.O. IS NOT SUSTAINABLE, HENCE DELETED. THE GROUND OF APPEAL IS ALLOWED. 5.2 AFTER TAKING INTO CONSIDERATION THE ARGUMENTS R AISED BY RESPECTIVE PARTIES AND FROM THE PERUSAL OF AFORE MENTIONED ORDER WE HA VE SEEN THAT THE CIT(A) HAS CONCLUDED THAT CONTRIBUTION OF PF AND ESIC PAYMENTS HAVE BEEN DEPOSITED IN THE GOVERNMENT ACCOUNT BEFORE FILING RETURN OF INCOME A ND WHILE RELYING UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. ALOM EXTURSIONS LTD. 319 ITR 306. THE CIT(A) HAS DELETED THE ADDITION M ADE BY AO. 8.2. AFTER ANALYZING THE AFORE MENTIONED ORDER WE F OUND THAT THE CIT(A) HAS DEALT WITH ALL THE ISSUES AND HAS PASSED JUDICIOUS AND WELL REASONED ORDER AND NO NEW CIRCUMSTANCES HAVE BEEN BROUGHT BEFORE US IN OR DER TO CONTROVERT OR REBUT THE FINDINGS RECORDED BY THE CIT(A). THEREFORE, WE SEE NO REASON TO DEVIATE OR INTERFERE INTO THE FINDINGS RECORDED BY THE CIT(A) AND HENCE, WE REJECT THESE GROUNDS RAISED BY THE REVENUE AND UPHOLD THE ORDER OF THE CIT(A). 9. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . 5 ITA NO. 4981/MUM/2013(A.Y. 2005-06) ITO VS. M/S. TRICOM INDIA LTD. ORDER PRONOUNCED IN THE OPEN COURT ON 5 TH AUGUST, 2016 SD/- SD/- (RAJENDRA) (SANDEEP GOSAIN) $ / ACCOUNTANT MEMBER &' $ / JUDICIAL MEMBER ( ) MUMBAI; *$ DATED : 05.08.2016 PS. ASHWINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. + ( ) / THE CIT(A) 4. + / CIT - CONCERNED 5. ./0 ''12 , 12# , ( ) / DR, ITAT, MUMBAI 6. 045 6 / GUARD FILE / BY ORDER, / !'# (DY./ASSTT. REGISTRAR) #$ %, ( ) / ITAT, MUMBAI