ITO 1(1)(1), MUMBAI V. AMIT SPINNING INDUSTRIES LTD, MUMBAI

ITA 8050/MUM/2010

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 8624 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 23-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 43B; 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH A, MUMBAI BEFORE SHRI I.P.BANSAL,JUDICIAL MEMBER & SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO.8050/MUM/2010(A.Y. 2007-08) THE INCOME TAX OFFICER 1(1)(1), ROOM NO.534/579, AAYKAR BHAVAN, MK ROAD, MUMBAI - 400 020. (APPELLANT) VS. M/S. AMIT SPINNING INDUSTRIES LTD., LOTUS HOUSE, 5 TH FLOOR, 33-A, NEW MARINE LINES, MUMBAI - 400 020- PAN: AAACA 3305M (RESPONENT) APPELLANT BY : SHRI MANOJ KUMAR RESPONDENT BY : MS. ARATI VISSANJI DATE OF HEARING : 03/10/2012 DATE OF PRONOUNCEMENT : 1 0/10/2012 ORDER PER I.P.BANSAL, J.M THIS IS AN APPEAL BY THE REVENUE. IT IS DIRECTED AGAINST THE ORDER PASSED BY LD. CIT(A)-1, MUMBAI, DATED 30/07/2010 FO R THE ASSESSMENT YEAR 2007-08. THE GROUNDS OF APPEAL READ AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN LAW, IN DIRECTING THE A.O. TO RECOMPUTED THE DISALLOWANCE U /S 14A READ WITH RULE SD AFTER CONSIDERING OUTSTANDING LIABILITY TOWARDS THE INVESTMENT. 1.1 THE CIT(A) FURTHER EARED IN ADMITTING ADDITIONA L EVIDENCE IN THE FORM OF DETAILS OF LIABILITY IN CONTRAVENTION TO RULE 46A 1.2 THE CIT(A) HAS FURTHER OVERLOOKED THAT THE MUMB AI HIGH COURT IN THE CASE OF GODREJ BOYCE HAS CONFIRMED THE CALCULATION UNDER RULE SD WHICH THE A 0. HAS RIGHTLY FOLLOWED. 2 ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE C IT(A) EARED IN LAW, IN DIRECTING THE A.O TO DELETE THE DISALLOWANCE OF RS. 24,35976/- U/S 2(24)(X) IN RESPECT OF DELAYED PAYMENTS OF EMPLOYEES CONTRIBUTI ON TO PROVIDENT FUND BY ITA NO.8050/MUM/2010(A.Y. 2007-08) 2 APPLYING PROVISION OF SECTION 435 WHICH ARE NOT APP LICABLE TO EMPLOYEES SHARE OF CONTRIBUTION, WHICH IS GOVERNED BY SECTION 2(24)(X)R. W.S,36(1)(IV). 2. APROPOS GROUND NO.1, A SUM OF RS.3,64,892/- WAS DISALLOWED BY AO UNDER SECTION 14A OF THE INCOME TAX ACT,1961(THE AC T). AS PER SUBMISSIONS MADE BY THE ASSESSEE BEFORE LD. CIT(A) IT WAS SUBMI TTED THAT EVEN AS PER RULE 8D, THE DISALLOWANCE CAN ONLY BE A SUM OF RS.55,069/-. LD. CIT(A) HAS ACCEPTED SUCH SUBMISSION OF THE ASSESSEE AND HA S RESTRICTED THE DISALLOWANCE ONLY TO THE EXTENT OF RS.55,069/-, WHI CH IS SAID TO BE AS PER RULE 8D(2). THE REVENUE IS AGGRIEVED WITH SUCH RED UCTION AND HAS FILED GROUND NO.1. 3. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. T HE IMPUGNED ASSESSMENT YEAR IS A.Y 2007-08 WHEN RULE 8D IS NOT APPLICABLE. HOWEVER, KEEPING THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE CALCULATIONS SUBMITTED BY THE ASSESSEE, WE DECLINE TO INTERFERE IN THE RELIEF GRANTED BY LD. CIT(A) AND THIS GROUND OF THE REVENUE IS DISMISSED . 4. SO FAR AS IT RELATES TO SECOND GROUND, THE DUE DATE AND DATE OF PAYMENT IN RESPECT OF EMPLOYEES CONTRIBUTION IN RES PECT OF PF WHICH WAS ADDED TO THE INCOME OF THE ASSESSEE, AS DESCRIBED I N PARA 5 OF THE ASSESSMENT ORDER ARE AS UNDER: MONTH OF DEDUCTION AMOUNT OF EMPLOYEES CONTRIBUTION. DUE DATE OF PAYMENT DATE OF PAYMENT APRIL 2006 2,53,116/- 15-05-2006 17-05-2006 MAY 2006 2,78,911/- 15-05-2006 20-06-2006 JUNE 2006 2,57,081/- 15-05-2006 18-07-2006 JULY 2006 2,68,235/- 15-05-2006 17-08-2006 AUGUST 2006 2,88,914/- 15-05-2006 20-09-2006 SEPTEMBER 2006 2,71,203/- 15-05-2006 17-10-2006 OCTOBER 2006 2,73,431/- 15-05-2006 21-11-2006 NOVEMBER 2006 2,53,906/- 15-05-2006 21-12-2006 MARCH 2007 2,91,179/- 15-05-2007 16-04-2007 TOTAL 24,35,976/- 5. THE DUE DATE OF FILING THE RETURN IN THE PRESE NT CASE IS 31/10/2007. LD. CIT(A) HAS DELETED THE ADDITION FOLLOWING THE D ECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. ALOM EXTRUSION LTD. 31 9 ITR 306(SC) AND ALSO ITA NO.8050/MUM/2010(A.Y. 2007-08) 3 THE DECISION OF HONBLE DELHI HIGH COURT IN THE CAS E OF CIT VS. AMIL LTD. 321 ITR 508. 6. WE HAVE HEARD BOTH PARTIES ON THIS ISSUE. WE FI ND THAT ALL PAYMENTS HAVE BEEN MADE BEFORE THE DUE DATE OF FILING THE RE TURN I.E. 31/10/2007. IN THE AFOREMENTIONED DECISION OF HONBLE SUPREME COU RT IN THE CASE OF CIT VS. ALOM EXTRUSION LTD. (SUPRA) IT HAS BEEN HELD THAT O MISSION OF SECOND PROVISO TO SECTION 43B AND THE AMENDMENT OF 1 ST PROVISO BY FINANCE ACT 2003, BRINGING ABOUT UNIFORMITY IN PAYMENT OF TAX, DUTY, CESS AND FEE ON ONE HAND AND CONTRIBUTION TO EMPLOYEES WELFARE FUNDS ON THE OTHER HAND ARE CURATIVE IN NATURE AND THUS EFFECTIVE RETROSPECTIVELY W.E.F. 1/4/1988, I.E. THE DATE OF INSERTION OF FIRST PROVISO. SIMILAR PROPOSITION HA S BEEN LAID DOWN BY HONBLE DELHI HIGH COURT IN THE AFOREMENTIONED DECISION IN THE CASE OF AIMIL LTD. (SUPRA), WHEREIN, IT HAS BEEN HELD THAT REDUCTION O F PAYMENT OF EMPLOYEES CONTRIBUTION TOWARDS PF AND ESIC CANNOT BE DISALLOW ED UNDER SECTION 43B IF THE ACTUAL PAYMENT IS MADE BEFORE THE DUE DATE OF F ILING THE RETURN, THOUGH BEYOND THE DUE DATES PRESCRIBED UNDER THE RELEVANT ACTS. THEREFORE, WE ARE OF THE OPINION THAT THERE IS NO INFIRMITY IN THE OR DER OF LD. CIT(A) WHEREIN IT HAS BEEN HELD THAT ADDITION OF RS.24,35,976/- WAS N OT CALLED FOR. WE DECLINE TO INTERFERE. THIS GROUND OF THE REVENUE IS ALSO D ISMISSED. 7. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 10 TH DAY OF OCT., 2012 SD/- SD/- (RAJENDRA ) (I.P.BANSAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 10 TH OCT., 2012. ITA NO.8050/MUM/2010(A.Y. 2007-08) 4 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CITY CONCERNED 4. THE CIT(A)- CONCERNED 5. THE D.R A BENCH. (TRUE COPY) BY ORDER ASST. REGISTRAR, I TAT, MUMBAI BENCHES MUMBAI. VM.