Surya Filling Station, Angul V. Assistant Director of Income Tax, CPC, Bengaluru

ITA 77/CTK/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6148 (ITAT-CUTTACK)
• Duration Of Justice: 5 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 13-07-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 43B; 43

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BEFORE Surya Filling Station, Talcher, Angul. PAN/GIR No. (Appellant This is an appeal filed by the assessee against the or CIT(A), National Faceless Appeal Centre, Delhi dated 12.8.2021 assessment year 2. The sole grievance of the assessee justified by not allowing Rs.6,54,071 and ESI although deposited before due date of filing return of income. 3. Facts giving rise to the present appeal are that the Asst. Income Tax, Centralized Processing Centre (“CPC”) , Bengaluru, while processing the return of the assessee, disallowed the claim of employee’s contribution towards PF and ESI on account of amount of Rs.5,34,980 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK ‘SMC’ BENCH, CUTTACK BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL ITA No.77/CTK/2021 Assessment Year : 2019-2020 Surya Filling Station, Talcher, Vs. Asst. Director of Income Tax, CPC, Bengaluru No. AATFS 2075 G (Appellant) .. ( Respondent Assessee by : Shri K.C.jena, AR Revenue by : Shri Charan Das Date of Hearing : 07/12/ 20 Date of Pronouncement : 20/12 O R D E R This is an appeal filed by the assessee against the or CIT(A), National Faceless Appeal Centre, Delhi dated 12.8.2021 assessment year 2019-2020. The sole grievance of the assessee is that the ld CIT, NFAC was not justified by not allowing Rs.6,54,071/- as contribution of employees to EPF and ESI although deposited before due date of filing return of income. Facts giving rise to the present appeal are that the Asst. ncome Tax, Centralized Processing Centre (“CPC”) , Bengaluru, while processing the return of the assessee, disallowed the claim of employee’s contribution towards PF and ESI on account of delay in depositing the f Rs.5,34,980/- and Rs.1,19,091/-, respectively. Page1 | 7 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH, CUTTACK JUDICIAL MEMBER 2020 Asst. Director of Income Tax, CPC, Bengaluru Respondent) , AR Charan Das (DR) / 2021 12/2021 This is an appeal filed by the assessee against the order of the CIT(A), National Faceless Appeal Centre, Delhi dated 12.8.2021 for the is that the ld CIT, NFAC was not as contribution of employees to EPF and ESI although deposited before due date of filing return of income. Facts giving rise to the present appeal are that the Asst. Director of ncome Tax, Centralized Processing Centre (“CPC”) , Bengaluru, while processing the return of the assessee, disallowed the claim of employee’s delay in depositing the respectively. ITA No.77/CTK/2021 Assessment Year : 2019-2020 Page3 | 7 confirmed by CIT(A) Delhi (NFAC) vide order dated 5.3.2021 and on appeal, the ITAT Jodhpur directed to allow the contribution to PF and ESI made deposited before the due date of filing the return of income. Ld A.R. also relied on the decision of ITAT Kolkata order dated 16.7.2021 in the case of Harendra Nath Biswas vs DCIT in ITA No.186/Kol/2021 for A.Y. 2019-2020, wherein also following the decision of Hon’ble Calcutta High Court in the case of Vijayshree, (2014) 43 taxmann.com 396 (Cal) and the decision of Hon’ble Supreme Court in the case of CIT vs. Alom Extrusion Ltd., 390 ITR 306 (SC) allowed the contribution to PF and ESIC deposited before the due date of filing of return of income as deduction. 7. Replying to above, Ld. DR supported the decisions of the authorities below and relied on the case laws referred by Ld.CIT(A) Delhi (NFAC) in the impugned order. 8. I have heard the rival contentions and perused the material available on record and perused the orders of the authorities below. In the instant case, the Asst. Director of Income Tax, CPC, Benaluru disallowed deduction for employees contribution made PF and ESIC amounting to Rs.5,34,980/- and Rs.1,19,091/-, respectively, as the same were not deposited by the assessee within the due date prescribed under the respective Acts. The CIT(A) Delhi NFAC confirmed the action of the Assessing Officer following some decisions of Hon’ble High Courts, wherein, it was held that the ITA No.77/CTK/2021 Assessment Year : 2019-2020 Page5 | 7 filed the appeal before the national Faceless Appeal Centre (NFAC), Delhi where the Ld. CIT(A) has taken note of the assessee’s submission that no disallowance was warranted in respect of delayed deposit of employees contribution to EPF /ESI fund since the assessee has deposited the employees contribution in respect of both these Acts (EPF & ESI Act) before filing the return of income and relied on the various judicial decision including that of the jurisdictional Hon’ble High Court of Calcutta in the case of CIT vs. Vijayshree Ltd. in [2014] 43 taxman.com 396(Cal). However the Ld. CIT(A) did not accept the contentions of the assessee in this regard and by relying on the Explanation-5 below section 43B which was brought in by Finance Act, 2021 to deny the claim of assessee. Therefore, the assessee is before us by preferring this appeal. 4. We have heard both the parties and perused the record. First of all we do not countenance this action of the Ld. CIT(A) for the simple reason that the Explanation 5 was inserted by the Finance Act, 2021, with effect from 01.04.2021 and relevant assessment year before us is AY 2019-20. Therefore the law laid down by the Jurisdictional Hon’ble High Court will apply and since this Explanation-5 has not been made retrospectively. So we are inclined to follow the same and we reproduce the order of Hon’ble Calcutta High Court in the case of Vijayshree Ltd. supra wherein the Hon’ble Calcutta High Court has taken note of the Hon’ble Supreme Court decision in CIT vs. Alom Extrusion Ltd. reported in 390 ITR 306. The Hon’ble Calcutta High Court’s decision in Vijayshree Ltd. supra is reproduced as under: “This appeal is at the instance of the Revenue and is directed against an order dated 28th April, 2011 passed by the Income Tax Appellate Tribunal, “A” Bench, Kolkata in ITA No. 1091/Kol/2010 relating to assessment year 2006-07 by which the Tribunal dismissed the appeal preferred by the Revenue against the order of CIT(A). The only issue involved in this appeal is as to whether the deletion of the addition by the AO on account of Employees ‘Contribution to ESI and PF by invoking the provision of Section 36(1)(va) read with Section 2(24)(x) of the Act was correct or not. It appears that the Tribunal below, in view of the decision of the Supreme Court in the case of Commissioner of Income Tax vs. Alom Extrusion Ltd., reported in 2009 Vol.390 ITR 306, held that the deletion was justified. Being dissatisfied, the Revenue has come up with the present appeal. ITA No.77/CTK/2021 Assessment Year : 2019-2020 Page7 | 7 Officer to take note of the rulings cited (supra) and examine/verify the fact as to whether the assessee had deposited the impugned amount of PF and ESIC before filing of the return. If the AO is satisfied about the said fact then he is directed to allow the claim of the assessee regarding payment of PF and ESIC paid before filing the return of income. 11. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 20 /12/2021. Sd/- (Chandra Mohan Garg) JUDICIAL MEMBER Cuttack; Dated 20 /12/2021 B.K.Parida, SPS (OS) Copy of the Order forwarded to : By order Sr.Pvt.secretary ITAT, Cuttack 1. The Appellant : Surya Filling Station, Talcher, Angul. 2. The Respondent. Asst. Director of Income Tax, CPC, Bengaluru 3. The CIT(A)-National Faceless Appeal Centre, Delhi 4. Pr.CIT-, 5. DR, ITAT, Cuttack 6. Guard file. //True Copy//