M/S HARI OIL MILLS PVT. LTD., JAIPUR V. ITO WARD 3(1), JAIPUR

ITA 59/JPR/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6100 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 07-07-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MONISHA CHOUDHARY JCIT A
• Keywords: Depreciation; Additional evidence; Unabsorbed depreciation
• Section: 43B; 143(1); 13; 154

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,B JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA. NO. 59/JP/2021 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2019-20 M/S HARI OIL MILLS PVT. LTD. INDUSTRIAL AREA F-64, JHOTWARA, JAIPUR. CUKE VS. THE ITO, WARD-3(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCM 3070 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI P.C. PARWAL (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SMT. MONISHA CHOUDHARY (JCIT) A LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 13/09/2021 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 14/09/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST T HE ORDER OF LD. CIT(A), DELHI (NFAC) DATED 23.06.2021 FOR THE ASSES SMENT YEAR 2019- 20 WHEREIN THE ASSESSEE HAS TAKEN THE FOLLOWING GRO UNDS OF APPEAL:- 1. THE LD. CIT(A), NFC HAS ERRED ON FACT AND IN LA W IN CONFIRMING THE ADDITION OF RS. 1,53,270/- U/S 36(1) (VA) ON ACCOUNT OF DELAYED PAYMENT OF EMPLOYEES CONTRIBUTIO N TOWARDS PF & ESI. HE HAS FURTHER ERRED IN MAKING THE ADDITI ON BY NOT FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT . ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 2 1.1 THE LD. CIT(A), NFC HAS ERRED ON FACT AND IN LA W IN NOT DECIDING AND ALLOWING THE SET OFF OF BROUGHT FORWAR D LOSSES AND DEPRECIATION AGAINST THE ADDITION CONFIRMED BY HIM. 2. THE LD A/R SUBMITTED THAT THE ASSESSEE FILED THE RETURN OF INCOME ON 30.09.2019 AT NIL INCOME AFTER CLAIMING SET OFF OF BROUGHT FORWARD BUSINESS LOSS OF RS.10,93,019/-. IT ALSO CLAIMED CA RRIED FORWARD BUSINESS LOSS OF RS.50,06,195/- AND UNABSORBED DEPR ECIATION OF RS.16,40,021/-. THE CPC, BANGALORE VIDE INTIMATION U/S 143(1) DT. 27.02.2020 MADE ADJUSTMENT OF RS.1,53,270/- ON ACCO UNT OF DELAYED PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS PF AND ES I. AGAINST THE ADJUSTMENT SO MADE, AN APPLICATION U/S 154 WAS FILE D ON 30.06.2020. THE CPC, BANGALORE VIDE ORDER U/S 143(1)/154 DT.17. 08.2020 AFFIRMED THE ADJUSTMENT SO MADE U/S 36(1)(VA) OF THE ACT. 3. IT WAS SUBMITTED THAT AGAINST THE SAID INTIMATIO N, THE ASSESSEE FILED APPEAL BEFORE LD. CIT(A) STATING THAT EMPLOYE ES CONTRIBUTION TO PF & ESI HAS BEEN PAID BEFORE THE DUE DATE OF FILLING OF RETURN AND THEREFORE, IN VIEW OF THE DECISIONS OF RAJASTHAN HI GH COURT, THE SAME CANNOT BE ADDED TO INCOME. THE ASSESSEE FURTHER SUB MITTED THAT THERE IS CARRIED FORWARD BUSINESS LOSS OF RS.50,06,195/- & UNABSORBED DEPRECIATION OF RS.16,40,021/- AND AFTER ALLOWING T HE SET OFF OF THE SAME, THERE WOULD NOT REMAIN ANY INCOME CHARGEABLE TO TAX. HOWEVER, LD. CIT(A) AFTER RELYING ON THE DECISION OF HONBLE GUJARAT HIGH COURT & KERALA HIGH COURT AND THE AMENDMENT BROUGHT BY FINA NCE ACT, 2021 WHEREIN IT HAS BEEN STATED THAT THE DEFINITION OF D UE DATES AS PER SECTION 43B IS DEEMED NEVER TO HAVE BEEN APPLIED FO R THE PURPOSE OF ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 3 EMPLOYEES CONTRIBUTION CONFIRMED THE ADJUSTMENT MAD E BY CPC, BANGALORE. 4. IT WAS SUBMITTED BY THE LD. AR THAT FROM THE FAC TS STATED ABOVE, IT CAN BE NOTED THAT CPC, BANGALORE VIDE ORDER U/S 143 (1)/154 DT. 17.08.2020 MADE ADDITION OF RS.1,53,270/- ON ACCOUN T OF DELAYED PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS PF AND ES I, DETAILS OF WHICH ARE MENTIONED AT PG 3-4 OF NFAC ORDER. WHILE DOING SO, IT HAS RELIED ON THE TAX AUDIT REPORT UPLOADED ONLINE WHERE THE ACTU AL DATE OF DEPOSIT HAS BEEN FILLED IN MM/DD/YY FORMAT INSTEAD OF DD /MM/YY FORMAT. THIS CHANGE IN THE FORMAT HAS RESULTED INTO CALCULATION OF DELAY IN DEPOSIT OF PF/ESI CONTRIBUTION WHEREAS THERE IS NO SUCH DELAY. FOR EG:-THE ACTUAL DATE OF PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS P F FOR THE MONTH OF MAY, 2018 IS 11.06.2018 BUT IT HAS BEEN MENTIONED A S 06.11.2018. SIMILARLY, THE ACTUAL DATE OF PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS ESI FOR THE MONTH OF DECEMBER, 2018 IS 09.01.2019 B UT IT HAS BEEN MENTIONED AS 01.09.2019. IN SUPPORT OF THE FACT THA T THERE IS NO DELAY IN DEPOSIT OF PF/ ESI CONTRIBUTION, STATEMENT SHOWI NG ESI AND EPF CONTRIBUTION AS PER MANUAL TAX AUDIT REPORT AND CHA LLANS OF PAYMENT OF PF & ESI ARE PLACED ON RECORD BY WAY OF ADDITIONAL EVIDENCE FROM WHICH IT IS EVIDENT THAT ALL PAYMENTS ARE MADE WITHIN DUE DATE. IN THIS REGARD, IT WAS SUBMITTED THAT THE ASSESSEE HAS ALSO AN APPL ICATION FOR ADMISSION OF ADDITIONAL EVIDENCE UNDER RULE 29 AND THE SAME M AY BE ADMITTED AND THE ADDITION SO MADE BE DELETED. 5. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE IS HA VING CARRIED FORWARD BUSINESS LOSS OF RS. 50,06,195/- & UNABSORB ED DEPRECIATION OF ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 4 RS.16,40,021/- AND AFTER ALLOWING THE SET OFF OF TH E SAME, THERE WOULD NOT REMAINED ANY INCOME CHARGEABLE TO TAX. THE LD. CIT(A) WITHOUT DECIDING THIS GROUND OF ASSESSEE HAS CONFIRMED THE ADDITION. 6. IT WAS FURTHER SUBMITTED THAT EVEN IF THERE IS D ELAY IN DEPOSIT OF PF/ESI BUT IF THE SAME IS PAID BEFORE THE DUE DATE OF FILING OF RETURN, ITAT, JODHPUR BENCH IN CASE OF MOHANGARH ENGINEERS AND CONSTRUCTIONS COMPANY VS DCIT & OTHERS (ITA NO. 5, 28 & 29 & 43/JODH/2021 DT. 12.08.2021) IN SIMILAR SITUATION AT PARA 13 TO 18 OF THE ORDER HAVE DELETED THE ADDITION MADE BY CPC, BANGALORE U/S 36( 1)(VA) WHERE THE SAME IS DEPOSITED BEFORE THE DUE DATE OF FILING THE RETURN BY FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT AS THE SA ME IS BINDING ON ALL THE APPELLATE AUTHORITIES UNDER ITS JURISDICTION IN THE STATE OF RAJASTHAN. IN VIEW OF ABOVE, ADDITION OF RS.1,53,270/- MADE BY CP C, BANGALORE U/S 36(1)(VA) BE DIRECTED TO BE DELETED. 7. PER CONTRA, THE LD. D/R SUBMITTED THAT THE ADDIT ION IN THIS CASE INVOLVES A DISALLOWANCE ON ACCOUNT OF DELAYED PAYME NT IN RESPECT OF EMPLOYEES CONTRIBUTION TO ESI/PF AS PER THE PROVISI ONS OF SECTION 36(1)(VA) OF THE IT ACT. REGARDING THE CONTENTION T HAT THERE IS NO DELAY IN DEPOSIT OF ESI/PF DUES AND ONLY DUE TO CER TAIN FORMAT ISSUE, THE DATE OF DEPOSIT HAS BEEN WRONGLY UPLOADED AND C APTURED IN THE IT SYSTEM WHILE FILING THE RETURN OF INCOME, IT WAS SUBMITTED THAT THE SAME NEEDS TO BE VERIFIED FROM THE IT SYSTEM. FURTH ER, IT WAS SUBMITTED THAT WHETHER THE PAYMENT AS CLAIMED WITHI N DUE DATE NEEDS TO BE VERIFIED WITH THE CHALLANS WHICH WERE S UBMITTED BY WAY OF ADDITIONAL EVIDENCE. ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 5 8. REGARDING THE ALTERNATE CONTENTION RAISED BY THE LD A/R THAT THE CONTRIBUTION SHOULD BE ALLOWED AS THE PAYMENTS WERE MADE BEFORE THE DUE DATE OF THE FILING OF THE ITR AS EVIDENCED FROM THE RETURN OF INCOME UPLOADED ON THE IT SYSTEM OF THE DEPARTMENT AND RELIANCE ON THE DECISION OF JODHPUR BENCHES OF THE TRIBUNAL, IT WAS SUBMITTED THAT THE HON'BLE GUJARAT HIGH COURT IN CIT VS GUJAR AT STATE ROAD TRANSPORT CORPORATION (2014) 366 ITR 170 (GUJ) AND THE HON'BLE KERALA HIGH COURT IN CIT VS MERCHANT (2015) 280 CTR 381 (KER) HAVE HELD THAT THE SCOPE OF SECTION 43B AND SECTION 36(1 )(VA) ARE DIFFERENT AND THUS, THERE IS NO QUESTION OF READING BOTH THE PROVISIONS TOGETHER TO CONSIDER WHETHER THE ASSESSEE IS ENTITLED TO DED UCTION IN RESPECT OF THE SUM BELATEDLY PAID TOWARDS SUCH CONTRIBUTION, E SPECIALLY, WHEN SUCH SUMS RECEIVED BY THE ASSESSEE (EMPLOYER) FROM HIS EMPLOYEE. THE EXPLANATION TO SECTION 36(1)(VA) OF THE IT ACT, 1961 CLEARLY DEFINES THAT THE 'DUE DATE MEANS THE DATE BY WHICH THE ASSESSEE IS REQUIRED AS AN EMPLOYER TO CREDIT AS EMPLOYEE'S CON TRIBUTION INTO THE EMPLOYEE'S ACCOUNT.' THIS FACT HAS BEEN FURTHER CLA RIFIED IN THE AMENDED PROVISIONS OF THE SECTION 36(1)(VA) IN THE FINANCE ACT 2021 WHEREIN IT HAS BEEN STATED THAT THE PROVISIONS OF S ECTION 43B DOES NOT APPLY TO SECTION 36(1)(VA) AND IS DEEMED TO NEVER H AVE BEEN APPLIED TO A SUM RECEIVED BY THE ASSESSEE FROM ANY OF HIS E MPLOYEES TO WHICH PROVISIONS OF SUB-CLAUSE (X) OF CLAUSE (24) O F SECTION 2 OF THE IT ACT, APPLIES. THE CLARIFICATORY AMENDMENT IS, BY ITS VERY DEFINITION, RETROSPECTIVE IN NATURE AND, THEREFORE, THE DISALLO WANCE AS MADE BY THE ASSESSING OFFICER IS PERFECTLY IN ORDER, AND TH EREFORE, THE ADDITION HAS BEEN RIGHTLY CONFIRMED BY THE LD CIT(A), NFAC. THE LD D/R ACCORDINGLY SUPPORTED THE ORDER OF THE LD CIT(A), N FAC. ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 6 9. IN HIS REJOINDER, THE LD A/R HAS SUBMITTED THAT THE JODHPUR BENCHES OF THE TRIBUNAL IN THE AFORESAID DECISION H AS FOLLOWED THE DECISIONS OF THE HONBLE RAJASTHAN HIGH COURT AND I N VIEW OF THE DECISION OF THE JURISDICTIONAL HIGH COURT, THE SAME WILL PREVAIL OVER THE CONTRARY DECISIONS RENDERED BY OTHER HIGH COURT S. IT WAS ACCORDINGLY SUBMITTED THAT THE ASSESSEES RELIANCE IS ON THE DECISION OF THE JODHPUR BENCHES OF THE TRIBUNAL AS WELL AS O N THE DECISIONS OF THE HONBLE RAJASTHAN HIGH COURT. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT HAS BEEN SUBMITTED BY THE LD A/R THAT THERE HAS BEEN NO DELAY IN DEPOSIT OF EMPLOYEESS CONTRIBUTIO N TOWARDS ESI AND PF AND ALL THE CONTRIBUTIONS HAVE BEEN DULY DEPOSIT ED WELL BEFORE THE DUE DATE AS PRESCRIBED UNDER THE RELEVANT STATUTE. IT HAS BEEN SUBMITTED THAT THE DELAY WHICH HAS BEEN REPORTED IS ON ACCOUNT OF CERTAIN TECHNICAL GLITCHES WHILE UPLOADING THE DATA AT THE TIME OF FILING OF THE RETURN OF INCOME. IN THIS REGARD, OUR REFERENC E WAS DRAWN TO MANUAL TAX AUDIT REPORT SIGNED BY THE TAX AUDITORS AS WELL AS THE PARTICULARS OF THE TAX AUDIT DATA WHICH HAS BEEN UP LOADED WHILE FILING THE RETURN OF INCOME AND IT WAS SUBMITTED THAT WHIL E MANUAL TAX AUDIT REPORT CONTAINS THE DATE OF DEPOSIT IN DD/MM/YY F ORMAT, THE SAME DATA WHILE UPLOADING ON THE IT SYSTEM OF THE DEPART MENT WAS CAPTURED IN MM/DD/YY FORMAT AND WHICH HAS RESULTED IN INCO RRECT REPORTING OF DATE OF DEPOSIT. ON PERUSAL OF BOTH THE MANUAL TAX AUDIT REPORT AS WELL AS DATA REFLECTED IN THE RETURN OF INCOME, WE FIND MERIT IN THE CONTENTION ADVANCED BY THE LD A/R AND NOTE THAT EXC EPT FOR THE DATE OF DEPOSIT, THE REST ALL DATA IS EXACTLY IDENTICAL IN TERMS OF PERIOD/MONTH OF CONTRIBUTION AND AMOUNT OF CONTRIBUTION TOWARDS ESI /PF AND IN RESPECT ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 7 OF DATE OF DEPOSIT, THE DATA IN THE MANUAL TAX AUDI T REPORT SHOWS THE ACTUAL DATE OF DEPOSIT IN DD/MM/YY FORMAT WHEREAS THE DATA AS REFLECTED IN THE RETURN OF INCOME SHOWS ACTUAL DATE OF DEPOSIT IN MM/DD/YY FORMAT WHICH APPARENTLY HAS RESULTED IN SHOWING DELAY IN DEPOSIT OF EMPLOYEES CONTRIBUTION. 11. GIVEN THAT THESE DETAILS IN TERMS OF MANUAL TAX AUDIT REPORT AND COPY OF CHALLANS REFLECTING PAYMENT OF ESI/PF CONTR IBUTION HAVE BEEN SUBMITTED BEFORE US BY WAY OF ADDITIONAL EVIDENCE, WE HEREBY ADMIT THE SAME IN THE INTEREST OF SUBSTANTIAL JUSTICE AND REM AND THE MATTER TO THE FILE OF THE AO FOR THE LIMITED PURPOSES OF VERIFYIN G THE ACTUAL DATE OF DEPOSIT OF EMPLOYEES CONTRIBUTION TOWARDS ESI/PF AS SO CLAIMED AND WHERE ON VERIFICATION, THE AO FOUND THE SAME TO BE IN ORDER, THE AO IS DIRECTED TO ALLOW THE NECESSARY RELIEF TO THE ASSES SEE BY DELETING THE ADDITION SO MADE. 12. IN VIEW OF THE AFORESAID DISCUSSIONS, WE DONT DEEM IT APPROPRIATE TO EXAMINE THE OTHER CONTENTIONS SO RAISED AS THE S AME HAVE BECOME INFRUCTIOUS. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISPO SED OFF IN LIGHT OF AFORESAID DIRECTIONS. ORDER PRONOUNCED IN THE OPEN COURT ON 14/09/2021. SD/- SD/- LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) ITA NO. 59/JP/2021 M/S HARI OIL MILLS PVT. LTD. VS. ITO 8 U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 14/09/2021. *SANTOSH VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- M/S HARI OIL MILLS PVT. LTD., JAIPUR . 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-3(1), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { ITA NO. 59/JP/2021} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR