Dy.CIT, Circle-2(3), Hyderabad V. M/s Godavari polymers Private Limited, Secunderabad

ITA 785/HYD/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7634 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 01-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: CHANDRASHEKHAR GOKHALE
• Section: 43B; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.785/HYD/14 : ASSESSMENT YEAR 2010 - 11 DY. COMMISSIONER OF INCOME - TAX CIRCLE 2(3), HYDERABAD V/S. M/S. GODAVARI POLYMERS PVT. LTD., SECUNDERABAD. ( PAN - AAACG 7496 H) (APPELLANT) (RESPONDENT) APPELLANT BY : S HRI R.MOHAN REDDY DR RESPONDENT BY : SHRI CHANDRASHEKHAR GOKHALE DATE OF HEAR ING 01.09 .2014 DATE OF PRONOUNCEMENT 03 .09.2014 O R D E R PER B.RAMAKOTAIAH, ACCOUNTANT MEMBER: THIS IS REVENUES APPEAL AGAINST THE ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) III, HYDERABAD DATED 17 TH FEBRUARY, 2014 FOR THE ASSESSMENT YEA R 2010 - 11. 2. THE ONLY EFFECTIVE GROUNDS OF THE REVENUE IN THIS APPEAL READ AS FOLLOWS - 1) THE CIT(A) ERRED IN GRANTING RELIEF TO THE ASSESSEE. 2) THE CIT(A) ERRED ON FACTS AND IN LAW IN GRANTING RELIEF TO THE ASSESSEE W I T H REFERENCE TO LATE REMITTANCE OF EMPLOYEES CONTRIBUTION OF P F AND ESI THOUGH THE DUE DATE MEN T ION E D IN SECTION 36(1)(V) IS DUE DATE, AS PER PF AND ESI ACT AND NO T AS PER I.T. ACT. 3. .. 3 . FACTS OF TH E CA S E IN BRIEF ARE THAT THE ASSESSEE COMPANY, E N GAGED IN THE B USINESS OF MANUFACTURE OF HDPE PIPES, FITTINGS AND MICRO I TA NO .785 /HYD/201 4 M/S. GODAVARI POLYMERS PVT. L TD., SECUNDERABAD. 2 IRRIGATION, HAS FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010 - 11 ON 28.9.2010 BY DECLARING AN INCOME OF R S .3,81,47,030. THE ASSESSING OFFICER NOTICED FROM ANNEXURE II TO FORM 3CD THAT THE ASSESSEE HAS MADE BELATED REMITTANCES INTO GOVERNMENT ACCOUNT, IN RESPECT OF EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND AND ESI FOR VARIOUS MONTHS OF THE YEAR UNDER CONSIDERATION . HE ACCORDINGLY TREATED SUCH BELATED REMITTANCES IN RESPECT OF CONTRIBUTI ONS TOWARDS PF AGGREGATING TO RS.11,54,034 AND TOWAR D S ESIC AGGREGATING TO R S .1,31,834 AS THE INCOME O F THE ASSESSEE UNDER THE HEAD INCOM E FROM OTHER SOURCES UNDER S.2(24)(X) R.W.S.36(1)(VA) READ WITH S.56(2)(IC) OF THE ACT. WITH THESE TWO ADDITIONS AGG REGATING TO R S . 1 2,85,868, THE ASSESSING OFFICER COMPLETED THE ASSESSMENT ON A TOTAL IN C OM E OF R S .3,98,32,890, VIDE ORDER OF ASSESSMENT DATED 30.1.2013 PASSED UNDER S.143(3) OF THE ACT. 4 . ON APPEAL BEFORE THE CIT(A), THE LEARNED AUTHORISED REPRESENTA TIVE FOR THE ASSESSEE, RELIED UPON THE DECISIONS OF THE TRIBUNAL IN THE CASE OF PATNI TELECOM SOLUTIONS 35 TAXMANN.COM 87 AND IN THE CASE OF IMERYS CERAMICS (INDIA) 245 TAXMANN.COM 320, BESIDES THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CI T V/S. P.M. ELECTRONICS LTD. (313 ITR 161) AND SUBMITTED THAT EVEN IF THE REMITTANCES IN RESPECT OF PF/ESI CONTRIBUTIONS ARE MADE AFTER THE DUE DATE, BUT BEFORE THE DUE DATE FOR THE FILING OF THE RETURN UNDER S.139 OF THE ACT, THE SAME COULD NOT BE DISALLO WED. THE CIT(A), FOLLOWING THE RATIO LAID DOWN IN THOSE CASES, OBSERVED THAT THE PAYMENTS IN RESPECT OF EMPLOYEES CONTRIBUTIONS TOWARDS PF/ESI ARE ALLOWABLE AS DEDUCTION AS LONG AS THE SAME ARE DEPOSITED IN THE GOVERNMENT ACCOUNT BEFORE THE DUE DATE OF F ILING OF RETURN UNDER S.139 OF THE INCOME TAX ACT. HE ACCORDINGLY DIRECTED THE ASSESSING OFFICER TO VERIFY THE CONTENTIONS OF THE ASSESSEE IN THAT BEHALF, AND ALLOW THOSE PAYMENTS WHICH HAVE BEEN DEPOSITED BEFORE THE DUE DATE OF FILING OF INCOME - TAX RET URNS AS PER S.139 OF THE ACT. I TA NO .785 /HYD/201 4 M/S. GODAVARI POLYMERS PVT. L TD., SECUNDERABAD. 3 5 . AGGRIEVED BY THE RELIEF GRANTED BY THE CIT(A), REVENUE PREFERRED THE PRESENT APPEAL BEFORE THIS TRIBUNAL. 6 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE IMPUGNED ORDERS OF THE REVENUE AUTHORITIES AND OTHER MATERIAL AVAILABLE ON RECORD. WE FIND THAT BESIDES THE DECISIONS OF THE TRIBUNAL IN THE CASE OF PATNI TELECOM SOLUTIONS 35 TAXMANN.COM 87 AND IN THE CASE OF IMERYS CERAMICS (INDIA) 245 TAXMANN.COM 320, APART FROM THE DECISION OF THE HONBLE DELHI HIGH COU RT IN THE CASE OF CIT V/S. P.M. ELECTRONICS LTD. (313 ITR 161) CONSIDERED BY THE CIT(A) IN THE IMPUGNED ORDER, THE RECENT DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S. HINDUSTAN ORGANICS CHEMICALS LTD., (366 ITR 1), WHICH HAS BEEN RELIE D UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE BEFORE US, ALSO COVERS THE ISSUE IN DISPUTE IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. IT HAS BEEN HELD, VIDE HEAD NOTE ON PAGE 2 OF THE REPORTS (366 ITR) INTER - ALIA AS FOLLOWS - HELD DISMISSING THE APPEAL, (I) THAT THE DEDUCTION COULD NO T HAVE BEEN DISALLOWED TO THE ASSESSEE. TH E SECON D PROVISO TO SECTION 43B WAS DELETED WITH E FFECT FROM APRIL 1, 2004, AND SIMULTANEOUSLY THE FIRST PROVISO WAS ALSO AM E N D E D BRINGING ABOUT A UNIFORMITY IN DEDUCTIONS CLA IMED TOWARDS TAX, DUTY, CESS AND FEE ON THE ONE HAND AND CON T RIBU T ION TO THE EMP L OYE E S PROVIDENT FUN D , SUPERANNUATION FUND AND OTHER WELFARE FUNDS ON THE OTHER. T H ESE DEDUC T ION S BEING CL A IM E D IN THE RETURN FOR THE ASSESSMENT YEAR 2006 - 07, THE AMENDMENTS T O SECTION 43B WHICH CAME INTO FORCE WITH EFFECT FROM APRIL 1, 2004, WOULD HAVE CLEARLY APPLIED TO THE ASSESSEES CASE. THER E FORE, THE TRIBUNAL WAS FULLY JUSTIFIED IN DELETING THE ADDITION OF R S .1,82,77,138 ON ACCOUN T O F THE DELAYED PAYMENT OF P R OVI D ENT FU NDS OF EMPLOYEES CONTRIBUTION. SINCE THE IMPUGNED ORDER OF THE CIT(A) ON THE POINT AT ISSUE IS IN CONSONANCE WITH THE RATIO LAID DOWN IN THE ABOVE DECISIONS, WE DO NOT FIND I TA NO .785 /HYD/201 4 M/S. GODAVARI POLYMERS PVT. L TD., SECUNDERABAD. 4 ANY INFIRMITY IN THE ACTION OF THE CIT(A) IN DELETING THE IMPUGNED ADDITIONS M ADE BY THE ASSESSING OFFICER. WE ACCORDINGLY UPHOLD THE IMPUGNED ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEAL. 7 . IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE C OURT ON 03.09.2014. SD/ - SD/ - (SAKTIJIT DEY) (B.RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER DT/ - 03 RD SEPTEMBER, 2014 COPY FORWARDED TO: 1. M/S. GODAVARI POLYMERS PVT. LTD., 315 MINERVA COMPLEX, S.D.ROAD, SECUNDERABAD 50 0 003. 2 . DY. COMMISSIONER OF INCOME - TAX CIRCLE 2(3), HYDERABAD 3. COMMISSIONER OF INCOME - TAX(APPEALS) III HYDERABAD 4. COMMISSIONER OF INCOME - TAX II, HYDERABAD 5 DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S