M/s Titanic Steel Industries Pvt. Ltd., Ludhiana V. DCIT, Central Circle -1, Chandigarh

ITA 76/CHANDI/2022

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 4210 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2018-2019
• Appeal Filed On: 08-02-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 139; 48; 13; 22

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ, च डीगढ़ I N T H E I N C O M E T A X A P P E L L A T E T R I B U N A L D I V I S I O N B E N C H , “ B ” , C H A N D I G A R H B E F OR E SH R I N . K . SA I N I , V I C E P R E SI D E N T & S H R I S U D H A N S HU SR I V A S T A V A , J U D I C I A L M E M B E R आयकर अपील सं./ ITA No. 76/C H D / 2 0 2 2 नधा रण वष / Assessment Year : 2 0 1 8 - 1 9 M/s Titanic Steel Industries Pvt. Ltd., Plot No. 78, Industrial Area, Phase-1, Chandigarh बनाम The DCIT, Central Circle-12, Chandigarh थायी लेखा सं./PAN NO: AACCT2034J अपीलाथ /Appellant यथ /Respondent Hearing though video Conferencing नधा रती क ओर से/Assessee by : Sh. Ashwani Kumar, CA राज व क ओर से/ Revenue by : Dr. Ranjeet Kaur, Sr. DR स ु नवाई क तार$ख/Date of Hearing : 18.04.2022 उदघोषणा क तार$ख/Date of Pronouncement : 21. 04.2022 आदेश/Order P er S u d h an sh u S ri va s ta va , J u d i c i a l M e mb e r : T hi s a p pe al is pr e f er re d b y t h e as s e s s ee ag a i ns t t he o r de r d a te d 27 . 1 2. 2 02 1 pa s s e d by t h e Ld . Co mm i s s i one r o f I nc o me T a x ( A p pe a l s )- 3, G ur g a o n [ he r e i n a f te r r e fe r r e d t o a s ‘ C IT (A ) ’] for a s s ess me n t ye a r 20 18- 1 9. 2. T he a s s e ss e e has r a i s ed th e fo l l ow i ng gr o un d o f a pp e al : - T he or d er p as s e d u /s 2 50( 6) of t h e I nc om e T ax Ac t, 19 61 b y th e L d . CIT ( A) -3, G ur g ao n is aga i ns t l aw an d f ac t s on t h e f i l e i n as m uch a s he w as n ot j us t i f i ed t o ar b i t r ar i l y u ph ol d t he ac t i o n o f t he Ce nt r al iz e d Pr o ce s s in g Ce n tr e , Be ngl ur a i n m a ki ng a 2 di s al l o wa n c e o f Rs . 1, 48 , 7 0, 9 8 0 / - p ai d o n a c c ou nt of e m p lo ye e s c on t r i b ut i on o f P F a n d ESI w hi ch w a s c le ar l y a l l ow an c e u/ s 4 3 B i n a s m uc h a s t he s am e ha d b e en d e p os i t e d t he s a m e b e f or e t he due d at e of f il i n g of t h e r e t ur n. 3. T he L d. A ut h o ri s e d R e pr es e n t a t i ve ( A R) a pp e a r i n g o n be h a l f o f t he a s s es s e e s ub m i t t e d t ha t it i s s e t t l e d l a w by now t h a t e mpl oy ee s ’ c on t r i b ut i o n t o E S I an d P F , t ho u gh no t pa id w i th in t he d u e d a t e s pr es c ri be d un d e r t h e re s pe c t iv e A c t, b ut p a i d w e l l be fo r e t he du e da t e o f fi l in g o f t he re t u rn o f i n c o m e u/ s 13 9 (1) o f th e A ct , w a s an al l ow a b l e e xp e ns e . I t w as t he c on te nt i o n o f t he L d. A R t h at i n t he ca pt i on e d a pp e a l t he a s s es s e e h a d de pos i t e d t h e e m p l o ye es c o nt ri bu t i o n t ow a r ds E S I a nd P F w e l l be f or e t he d u e d a te o f f il i n g o f t he r et ur n o f i n c o m e u/ s 1 39 (1) o f t h e A c t an d t h a t t hi s f ac t o f fi l i n g o f r e t u rn b e f or e t h e d ue da t e pr e s c r i b ed u / s 1 39( 1 ) o f th e A ct w as not in di s p ut e . T he L d . A R pl a ce d re l i a n c e o n a pl e t h or a o f or d e rs o f t he va r io us Be nc h es o f t he T ri bu na l ac ros s t h e co u nt ry a s w el l as of ju ri s d i c ti on a l H i gh Co urt na me l y H o n 'b le P u nj a b & H a r y a na H i g h Co ur t. It w a s s ub m it t ed t ha t t he H on' bl e K ar na t a k a H i gh C o ur t , H on ' bl e D e l h i H i g h Co u rt , H on ' bl e Ra j as t h a n H ig h Co u rt , H o n 'b l e P a t na H i gh C ou r t, H on ' bl e A l la ha b a d H i gh C ou rt a n d H o n' bl e G au ha t i H i gh C ou rt ha d r ul e d in f av o ur o f t he a s s es s e e on t he i s sue. 4 P e r c o n t r a, th e L d . S r. D e pa rt me nt a l R e p re s e n t a t iv e (S r. D R) re l ie d o n th e o rd e r o f th e L d. CI T (A ) a nd v e h e m e ntl y a rgu e d t ha t n o de d uc t i o n w as a l l ow abl e i n re s pe ct o f l at e de p os i t o f e mp l o y ee s ’ 3 c on t r i b ut i o n t ow a r ds P F a nd E S I an d t ha t t he A m e nd me nt s t o s e ct i o ns 36 ( 1) ( v a ) an d 4 3 B o f t he In c o me Ta x A c t , 19 6 1 e ff ect ed b y F i n a n ce A ct , 202 1 w er e c la r i fi c a t or y in n at ur e a nd w ou l d a pp l y re t ros p e c t i v e l y. 5. We ha ve h e a r d th e ri va l s u b m i s s io ns a n d ha ve a l so p er us e d t h e m at er ia l o n r e c o rd . T h e fa c t t h a t i n t he pr e s e n t a pp ea l t he e mpl oy ee s ’ c on t r i b ut i o n o f E S I a n d P F had be en de p os i t e d be f ore t h e d ue da t e o f fi l in g o f re tu r n u/ s 13 9( 1) o f t he A c t i s n o t i n d is p u t e. It is s ee n th at t he s a i d is s ue , as fa r a s t h e p re s e nt F oru m is c on cer ne d, s t a nds ful l y c ov e r e d i n fa vo u r o f t h e a ss e s s e e no t o nl y by t he co ns i st e nt o rd er s o f t he v a r i o us Be nc h es o f t he I TA T a c r os s t h e c o un t r y b u t al s o b y t he c ons i s t e n t o r de rs of th e C h a n di ga r h B en c h o f t h e ITA T . It i s s e en t h a t a ll a l o ng , t he C o- or d i n a t e B e n c he s h av e h e l d t ha t th e a me nd me nt s t o S e ct i ons 36 (1 ) ( va ) a nd u /s 4 3B o f t h e I nc o me T ax A ct e f fe ct e d b y t he F i na n ce A c t, 2 02 1 a re a p p l ic a b l e p ros p ec ti ve l y a n d no t r et r o sp e c t i v e l y. Wh il e c o mi n g t o t h e s a id co nc lu si on , t he Be n ch es hav e r e li e d u p o n t h e N ot es o n C l a us es a t th e t i me o f i nt ro duc t i on o f t h e F i n a n ce A c t , 20 21 a nd ha ve he l d th a t t h e a m e n d me nt i s ap p l i c a b le in re l a t i on t o t h e a s s es s men t y e a r 2 0 21- 22 a nd su bs e qu e nt y e a r s an d n ot r et r o s pe c t i v e l y. T h us , in vi ew o f t hi s l eg al pos i t io n, as c ons i d e r e d b y t he C o- o r di n a t e Be nc h e s a n d du l y ta k i n g n ot e o f t he ju d ge me nt s o f the j ur is d ic t i on al H i gh C o ur t i n th e c a s e o f CI T V s N uc h e m L i m i t e d ( I T A 323 o f 2 00 9 ) a nd CI T V s H e ml a E m br oi d e r y M il l s P vt . L t d. (2 0 14 ) 36 6 I T R 16 7, w e a re o f th e v i ew t h at t he a d di t i o n c a n not b e m ad e o r s u s t a in ed o n t h e 4 s t re n gt h o f t he a m e nd me nt e ff e c t ed b y F i na nc e A c t , 20 21 t o S e ct i o ns 36 ( 1) ( v a ) / 4 3B o f t h e A c t a s th e le ga l p os it i on t he re on is v e ry c l e a r. Th e de p a r t me n t a l s t an d t ha t i t is c la ri fi c at o r y i n n at ur e ha s co n s is t e n t l y b e e n re j ec t ed . T h us , in t he f ac e o f t he c le a r l e g a l p osi t io n, w e fi n d th at t he c la i m o f t he as s e s see i s t o be a l l ow e d. A l t h o ug h , t h e L d . D R ha s ar g ue d a t le n g t h a n d h as for w a r d e d ma ny re a s o ns i n s u pp o r t o f he r c on t e n t i on, w e ar e u na b le t o s u bs cr ib e t o t h e s a me a s t h ey a r e c on tr a r y t o t h e l aw l ai d do w n by t he J u ri s d ic t i o n a l H i g h Co u rt i . e . t he H on ’b l e P unj a b & H ar ya na H i g h C ou r t a nd w e a re b ou n d t o a p pl y th e law a s l a i d d ow n b y t he J u r i sd ic t i o n al H ig h C o ur t . We a ls o n o t e t h at o nl y f o ur H o n ' bl e H i g h Co u rt s i . e. G uj a r at H ig h C our t, M ad ra s H i gh Co u rt , M P H i gh C o ur t a nd K er el a H i g h C ou r t h av e g i ve n d is s e n t i n g v i ew as o f no w on t h e sa i d i s s ue . H o w e ve r, w e ar e bo u n d b y t h e l aw la i d d ow n by t h e H o n ' b le P unj a b a n d H a ry a na H ig h C ou r t i n th e c as e o f C I T V s. H em la E mbr oi d er y M i l ls ( P ) Lt d (s up ra ) w he re i n i t w a s c ate g or i c al l y h e l d t h a t t he re s p on de n t – a s s es s e e w as en t i t le d t o d e d uc ti on i n re s pe c t o f e mpl o y e r a n d e mp l oye e ’s co n tr ib ut io n t o E S I a nd P rovi d e n t F u nd a s t h e s a me h a d b e e n de p os i t e d pr i o r to t h e f i l i n g o f t he r e t ur n u /s 139 ( 1 ) o f t he A c t . Th e ju d g m ent o f t he H o n' bl e G u j a r at H i gh Co u rt ha s b e e n di s t i n g ui s h e d b y C ha n di ga rh B e n c h o f t h e IT A T i n t he c a s e o f G i l c o E x por ts L t d. V s . A CI T, C ir cl e 2 (1 ) r e po r t e d i n ( 2 019 ) 1 7 8 I TD 8 6 5 (C hd. Tr i b. ) a n d i t ha s b e e n he l d t h a t an y su m re c ei ve d f ro m e mp lo ye es t ow ar ds E P F & E S I c o n t r i b ut io n d e p o s i t ed la t e b ut be fo r e th e d ue d a t e o f fi l i n g o f r et ur n w ou l d be e nt i t l e d t o de d u c t i o n. It i s a l s o t o be n ot e d 5 t ha t i n t e r ms o f A r ti c le 2 2 7 o f th e C o ns t i t u t i o n o f In d i a , w he n d e c i s i o n o f J u r i s di ct i on a l H i gh C o ur t i s av a i l a b l e o n t h e i ss ue, n o n -J ur is d ic t io na l H i gh C o u rt c a nn ot be fo l l o w e d. It i s t ri te t ha t w hen t her e is ju dg me nt o f J u ri s di c t io na l H ig h Co ur t fo r a ny a u t h or it y w i t hi n i ts t e r r i to ri al j ur i s di c t i o n s ubj ec t ed t o i t s s up e r i n t e n den ce de c isi o n r e c o rd e d b y H i g h Co u rt i s a b i nd i n g p re c e de nt t o b e fo l l ow ed . I t is a l s o t o b e n ot e d t h a t e ve n t he M e m o ra n du m ex p l a i ni ng t h e a me n d m en ts ha s la i d d ow n t h at t he a me n d me n t s s h al l b e e ffe c ti ve fr o m as s e s s me n t ye ar 2 0 20 - 2 1 a nd, t he re fo re , co n s id e r in g t h e e n t i re ty o f f ac t s a nd res pe ct f u ll y fol l ow i n g t he j ud ge m e nt o f th e J ur is d i c t io n al H ig h Co ur t a s we l l a s t h e C oo r di na te Be nc h e s o f th e T ri b una l , w e a r e o f t he c on s i d e re d vi e w t h a t t he cl a i m o f t he a s s e s s ee w i t h re s pe ct t o t h e d e p os i t o f e mp l o y ee s ’ c o nt ri bu t i o n t ow ar ds E S I a n d P F pa i d b e fo re t h e du e da te o f fi l in g o f re tu rn o f i nc o me u/ s 13 9( 1) o f th e A ct de s e r ve s t o s u cc ee d. 6. In th e fi n a l r es u lt , t h e a p pe al o f t he a s se s s e e s t an ds al l ow e d . O rde r p ro no un c e d o n 21. 04 . 2 0 22 . Sd/- Sd/- ( N. K. SAINI) (SUDHANSHU SRIVASTAVA) Vice President Judicial Member Dated : 21.04.2022 “आर.के.” आदेशक त+ल,पअ-े,षत/ Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकरआय ु .त/ CIT 4. आयकरआय ु .त (अपील)/ The CIT(A) 5. ,वभागीय त न1ध, आयकरअपील$यआ1धकरण, च3डीगढ़/ DR, ITAT, CHANDIGARH 6 6. गाड फाईल/ Guard File आदेशान ु सार/ By order, सहायकपंजीकार/ Assistant Registrar