DEPUTY COMMISSIONER OF INCOME TAX 15(3)(1), MUMBAI V. WANBURY LIMITED, MUMBAI

ITA 7366/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 6381 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2012-2013
• Appeal Filed On: 26-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ARUN KUMAR SINGH
• Section: 43B; 143(3); 144C

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL G BENCH MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NO.7366/MUM/2017 (ASSESSMENT YEAR 2012-13) DCIT-15(3)(1) ROOM NO. 451, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020. VS. M/S WANBURY LTD. B-WING, 10 TH FLOOR, BSEL, TECH PARK, SECTOR 30, OPP. VASHI RAILWAY STATION, VASHI, NAVI MUMBAI- 400705. P AN: AABCP5939P APPELLANT RESPONDENT APPELLANT BY : SHRI CHAUDHARY ARUN KUMAR SINGH (DR) RESPONDENT BY : SHRI BHAVIN SHAH WITH MR. GAURAV GOYAL (AR) DATE OF HEARING : 06.02.2019 DATE OF PRONOUNCEMEN T : 06.02.2019 ORDER UNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. THIS APPEAL BY REVENUE UNDER SECTION 253 OF THE INC OME-TAX ACT (THE ACT) IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER O F INCOME-TAX-24, MUMBAI (THE LD. CIT(A) DATED 26.09.2017, WHICH IN T URN ARISES FROM THE ASSESSMENT ORDER DATED 11.05.2016 PASSED UNDER SECT ION 143(3) R.W.S. 144C FOR ASSESSMENT YEAR 2012-13. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS.1,50,62,82 0/- ON ACCOUNT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND AND ESIC, WHICH WAS PAID BEYOND THE DATE PRESCRIBED IN THE RELEVANT ACT, RELYING ON THE DECI SION OF HON'BLE APEX COURT IN ITA NO. 7366 MUM 2017-M/S WANBURY LTD. 2 THE CASE OF ALOM EXTRUSION LTD. (319 ITR 306) WHICH IS NOT RELEVANT TO SECTION 36(1)(VA) OF THE ACT.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS.1,50,62,82 0/- ON ACCOUNT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND AND ESIC, WHICH WAS PAID BEYOND THE DATE PRESCRIBED IN THE RELEVANT ACT, THEREBY IGNORING TH E CBDT CIRCULAR NO.22/2015 DATED 17.12.2015 WHEREIN THE ISSUE HAS BEEN MADE CL EAR AND IT IS SPECIFICALLY HIGHLIGHTED THAT THE SUPREME COURT DECISION IN THE CASE OF ALOM EXTRUSION LTD. (319 ITR 306) AND THE CIRCULAR DOES NOT APPLY TO CL AIM OF EMPLOYEES CONTRIBUTION TO WELFARE FUNDS WHICH ARE GOVERNED BY SECTION 36(1)(VA) OF THE ACT. 3. 'THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A ), MUMBAI ON THE ABOVE DIRECTIONS BE SET-ASIDE AND THAT OF THE ASSESSING O FFICER BE RESTORED.' 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-COMPA NY IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF BULK DRUGS AND TRADING OF PHARMACEUTICAL PRODUCTS, FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2012-13 ON 30.11.2012 DECLARING NIL INCOME. THE RETURN OF INCO ME WAS SELECTED FOR SCRUTINY. THE ASSESSING OFFICER DURING THE ASSESSME NT NOTED THAT ASSESSEE CLAIMED DEDUCTION FOR EMPLOYEES CONTRIBUTION TOWAR DS PROVIDENT FUND AND ESIC. THE ASSESSEE HAS PAID CONTRIBUTION AFTER DUE DATE PRESCRIBED UNDER PROVIDENT FUND & ESIC ACT. THE ASSESSEE WAS SHOW-CA USED AS TO WHY THE CONTRIBUTION TOWARDS PROVIDENT FUND & ESIC BE NOT D ISALLOWED. THE ASSESSEE FILED ITS REPLY AND CONTENDED THAT THE CON TRIBUTION HAVE BEEN PAID BEFORE DUE DATE OF FILING OF RETURN OF INCOME, THER EFORE, NO DISALLOWANCE TO BE MADE. THE ASSESSEE ALSO CONTENDED THAT THE ASSES SEE HAS COMPUTED DISALLOWANCE ON ACCOUNT OF DELAYED DEPOSIT OF ESIC CONTRIBUTION. THE ITA NO. 7366 MUM 2017-M/S WANBURY LTD. 3 CONTENTION OF ASSESSEE WAS NOT ACCEPTED BY ASSESSIN G OFFICER. THE ASSESSING OFFICER MADE DISALLOWANCE UNDER SECTION 3 6(1)(VA) OF RS. 1,50,62,820/-. ON APPEAL BEFORE THE LD. CIT(A), THE ENTIRE DISALLOWANCE WAS DELETED BY FOLLOWING THE DECISION OF HONBLE BOMBAY HIGH COURT IN CIT VS. HINDUSTAN ORGANICS CHEMICALS LTD. 366 ITR 1. THUS, AGGRIEVED BY THE ORDER OF LD. CIT(A), THE REVENUE HAS FILED THE PRES ENT APPEAL BEFORE US. 3. WE HAVE HEARD THE SUBMISSION OF LD. DEPARTMENTAL RE PRESENTATIVE (DR) FOR THE REVENUE AND LD. AUTHORIZED REPRESENTATIVE (AR) OF THE ASSESSEE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. 4. AT THE OUTSET OF HEARING, THE LD. AR OF THE ASSESSE E SUBMITS THAT THE GROUND OF APPEAL RAISED BY REVENUE IS COVERED IN FAVOUR OF ASSESSEE BY FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT IN CIT VS . HINDUSTAN ORGANICS CHEMICALS LTD. (SUPRA) AS WELL AS DECISION OF TRIBU NAL. THE LD. AR OF THE ASSESSEE FURTHER SUBMITS THAT LD. CIT(A) GRANTED TH E RELIEF TO THE ASSESSEE BY FOLLOWING THE DECISION OF JURISDICTIONAL HIGH COURT . 5. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE RELIE D UPON THE ORDER OF ASSESSING OFFICER. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSION OF THE PART IES AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE ASSESSING OFFICER MADE THE DISALLOWANCE ON HIS OBSERVATION THAT THE ASSESSEE FILED CONTRIBU TION AND ESIC & PROVIDENT FUND AFTER DUE DATE OF FURNISHING RETURN UNDER THE ESIC ACT AND EMPLOYEES PROVIDENT FUND AND MISCELLANEOUS PROVISIONS ACT. TH E LD. CIT(A) DELETED ITA NO. 7366 MUM 2017-M/S WANBURY LTD. 4 THE ENTIRE DISALLOWANCE BY FOLLOWING THE DECISION O F CIT VS. HINDUSTAN ORGANICS CHEMICALS LTD. 366 ITR 1. WE HAVE NOTED TH AT THE HONBLE JURISDICTIONAL HIGH COURT IN CIT VS. HINDUSTAN ORGA NICS CHEMICALS LTD. (SUPRA) HELD THAT WHERE ASSESSEE COMPANY MADE PAYME NT OF EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND, ASSESSEE'S CLA IM COULD NOT BE DISALLOWED ON ACCOUNT OF DELAYED PAYMENT IN VIEW OF AMENDMENT TO SECTION 43B . 7. CONSIDERING THE DECISION OF JURISDICTIONAL HIGH COU RT WHICH IS DIRECTLY ON THE ISSUE INVOLVED IN THE PRESENT APPEAL, WE DO NOT FIND ANY MERIT IN THE GROUNDS OF APPEAL RAISED BY REVENUE. NO CONTRARY FA CTS OR LAW IS BROUGHT TO OUR NOTICE TO TAKE ANY OTHER VIEW, THEREFORE, THE G ROUNDS OF APPEAL RAISED BY REVENUE IS REJECTED. 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06/ 02/2019. SD/ SD/- MANOJ KUMAR AGGARWAL PAWAN SINGH ACCOUNTANT MEMBER JU DICIAL MEMBER MUMBAI, DATE: 06.02.2019 SK COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR G BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI