Bloom Dekor Ltd., Ahmedabad V. The Dy. CIT.,Circle-1, Ahmedabad

ITA 930/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1427 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 02-06-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 30-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRS SMITI SAMANT
• Keywords: Business income; Onus to prove
• Section: 43B; 143(3); 80HHC; 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHM EDABAD , (BEFORE SHRI RAJPAL YADAV, J.M. & SHRI ANIL CHATURV EDI, A.M.) ( , ! ' ,#$ # %& ) ITA NO. 930/AHD/2012 (ASSESSM ENT YEAR: 2003-04) BLOOM DEKOR LIMITED 2 ND FLOOR, SUMEL, GNFC INFO TOWER, S.G.HIGHWAY, THALTEJ, AHMEDABAD VS. DCIT, CIRCLE-1, AHMEDABAD PAN NO. AAACB6221B (APPELLANT) (RESPONDENT) APPELLANT BY : MS. URVASHI SHODHAN, A.R. RESPONDENT BY : MRS. SMITI SAMANT, SR. D.R. DATE OF HEARING : 02 -06-2 016 DATE OF PRONOUNCEMENT : 08 -06-2016 ( # )/ ORDER PER ANIL CHATURVEDI, ACCOUNTANT MEMBER THIS APPEAL FILED BY ASSESSEE IS AGAINST THE ORDER OF CIT(A)-VI, AHMEDABAD, DATED 07.09.2010 FOR THE ASSESSMENT YEAR 2003-04 . 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER: 3. THE ASSESSEE IS A COMPANY STATED TO BE ENGAGED I N THE BUSINESS OF MANUFACTURING OF DECORATIVE AND INDUSTRIAL LAMINATE D SHEETS. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2003-04 ON 27.11.2003 DEC LARING TOTAL INCOME OF RS.51,73,970/-. THE ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT VIDE ORDER ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 2 DATED 28.03.2006 AND THE TOTAL INCOME WAS ASSESSED AT RS.62,49,970/- BY RESTRICTING THE CLAIM OF DEDUCTION U/S.80HHC OF THE ACT TO RS.17,82,607/-. SUBSEQUENTLY, THE ASSESSMENT WAS REOPENED BY ISSUIN G NOTICE U/S.148 OF THE ACT AND THEREAFTER, ASSESSMENT WAS FRAMED U/S.143(3) R. W.S. 147 OF THE ACT VIDE ORDER DATED 14.10.2008 AND THE TOTAL INCOME WAS DETERMI NED AT RS.66,74,400/-. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED TH E MATTER BEFORE THE LD. CIT(A) WHO VIDE ORDER DATED 07.09.2010 (IN APPEAL NO. CIT( A)-VI/DCIT.CIR.1/319/08- 09) GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIE VED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1 LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIR MING ACTION OF AO IN EXCLUDING CREDIT CHARGES OF RS.10,19,799/- RECEIVED FROM CUST OMERS ON LATE PAYMENT FROM ELIGIBLE PROFITS OF BUSINESS WHILE COMPUTING DEDUCT ION U/S 80HHC OF THE ACT. LD. CIT (A) ERRED IN NOT APPRECIATING THE FACT THAT THE CREDIT CHARGES ON LATE PAYMENT FROM CUSTOMERS HAVE DIRECT NEXUS WITH BUSIN ESS OF THE APPELLANT. LD. CIT (A) OUGHT TO HAVE DELETED EXCLUSION OF CREDIT C HARGES FROM PROFITS OF THE BUSINESS FOR COMPUTING DEDUCTION U/S 80HHCOF THE AC T. 2 LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFIR MING ACTION OF AO IN REDUCING INTEREST INCOME OF RS.2,20,388/- FROM PROFITS OF TH E BUSINESS FOR COMPUTING DEDUCTION U/S 80HHC OF THE ACT. BOTH THE LOWER AUTH ORITIES ERRED IN NOT APPRECIATING THE FACT THAT THE INTEREST ON LC AND B ANK GUARANTEE MARGIN MONEY HAS DIRECT NEXUS WITH MAIN BUSINESS ACTIVITY OF THE APPELLANT. LD. CIT (A) OUGHT TO HAVE HELD INTEREST ON MARGIN MONEY TO BE PART OF PROFITS OF BUSINESS ELIGIBLE FOR DEDUCTION U/S 80HHC OF THE ACT. 3 LD. CIT (A) ERRED IN LAW AND ON FACTS IN CONFI RMING DISALLOWANCE MADE BY AO OF RS.19,233/- ON ACCOUNT OF DELAYED PAYMENT OF EMPLOY EE CONTRIBUTION TO PROVIDENT FUND. LD. CIT (A) GROSSLY ERRED IN CONFIR MING DISALLOWANCE HOLDING THAT IN ABSENCE OF JUDGMENT OF JURISDICTIONAL HIGH COURT DELAYED EMPLOYEE CONTRIBUTION THOUGH MADE BEFORE FILING OF RETURN IS NOT AN ALLOWABLE EXPENSE. LD. CIT(A) OUGHT TO HAVE DELETED DISALLOWANCE. 4. REGISTRY HAS INFORMED THAT THE APPEAL HAS BEEN F ILED LATE BY 499 DAYS. BEFORE US, ASSESSEE HAS FILED AFFIDAVIT OF THE DIRE CTOR, WHEREIN THE REASONS FOR DELAY IN FILING OF APPEAL INTER ALIA IS STATED TO BE NOT PUTTING THE ORDER OF CIT(A) BEFORE THE CONCERNED PERSONS BY THE CONCERNED ACCOU NTS ASSISTANT OF ASSESSEE ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 3 DUE TO HIS RESIGNATION. IN SUPPORT OF THE STATEMEN T OF RESIGNATION OF THE CONCERNED ACCOUNTANT. ASSESSEE HAS ALSO FILED THE COPIES OF HIS RESIGNATION LETTER, CLEARANCE REPORT, FINAL SETTLEMENT ACCOUNT OF KAMLESH LUHAR. IT WAS THEREFORE SUBMITTED THAT IN THE INTEREST OF JUSTICE, THE DELAY IN FILING THE APPEAL BE CONDONED. LD. D.R. DID NOT SERIOUSLY OBJECT TO THE CONDONATION PETITION F ILED BY ASSESSEE. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND THE AFFIDAVIT OF THE DIRECTOR, WE ARE OF THE VIEW THAT THERE WAS REASONABLE CASUSE FOR DELAYED FILING OF APPEAL BEFORE THE TRIBUNAL. IN THE INTEREST OF JUSTICE, WE THEREFORE CONDONE THE DELAY AND ADMIT THE APPEAL FOR HEARING. 5. GROUND NOS. 1 & 2 ARE WITH RESPECT TO CLAIM OF D EDUCTION U/S.80HHC OF THE ACT. 5.1 DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS, A.O. NOTICED THAT ASSESSEE HAD RECEIVED INTEREST FROM BANKS AND INTEREST FROM CUSTOMERS ON ACCOUNT OF LATE PAYMENT , THE AGGREGATE INTEREST BEING RS.12,40,18 7/-. AO WAS OF THE VIEW THAT THE AFORESAID INTEREST WAS NOT ELIGIBLE FOR DEDUCTI ON U/S.80HHC OF THE ACT AND 90% OF THE SAME WAS REQUIRED TO BE REDUCED FROM THE BUSINESS PROFIT FOR COMPUTING DEDUCTION U/S.80HHC OF THE ACT. HE ACCOR DINGLY EXCLUDED THE SAME FROM BUSINESS PROFIT AND REWORKED DEDUCTION U/S.80H HC OF THE ACT TO RS.13,98,396/-. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) WHO CONFIRMED THE ACTION OF A .O. BY HOLDING AS UNDER: 4.3 I HAVE CONSIDERED THE FACTS OF THE CASE, ASSES SMENT ORDER AND APPELLANTS SUBMISSION. THE CRUX OF THE APPELLANTS ARGUMENT I S THAT THE INTEREST INCOME ON LC AND MARGIN MONEY DEPOSIT IS PART OF BU SINESS PROFIT AND NOT TAXABLE AS INCOME FROM OTHER SOURCES THEREFORE THE SAME SHOULD BE INCLUDED FOR ALLOWING DEDUCTION UNDER SECTION 80HHC . I DO NOT AGREE WITH THE APPELLANTS ARGUMENT SINCE OUT OF BUSINESS : PROFIT ONLY, CERTAIN ITEMS ARE TO BE REDUCED AS PER CLAUSE 'BAA. THE RE LEVANT PART OF THE SECTION 80HHC IS QUOTED BELOW FOR BETTER UNDERSTAND ING OF THE PROVISION- ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 4 '(BAA) PROFIT OF BUSINESS THE PROFIT OF BUSINESS CO MPUTED UNDER THE HEAD' PROFITS AND GAINS OF BUSINESS OR PROFESSION' AS RED UCED BY- (1) 90% OF ANY SUM REFERRED TO--OR ANY RECEIPTS BY WAY OF BROKERAGE, COMMISSION, INTEREST, RENT, CHARGES OR A NY OTHER RECEIPT OF A SIMILAR NATURE INCLUDED IN SUCH PROFIT S, AND (2) THE PROFIT OF ANY BRANCH OF THIS, WAREHOUSE OR ANY OTHER ESTABLISHMENT OF THE ASSESSEE SITUATE OUTSIDE INDIA .' FROM THE ABOVE IT CAN BE SEEN THAT INTEREST INCOME INCLUDED IN PROFIT OF BUSINESS HAS TO BE EXCLUDED FOR THE COMPUTATION OF DEDUCTION UNDER SECTION 80 HHC. CONSIDERING THIS, INTEREST ON MARGIN DEPOSIT O R LC IS TO BE EXCLUDED ALTHOUGH THEY ARE PART OF BUSINESS INCOME. IN VIEW OF THE CLEAR PROVISIONS OF THE ACT, THE AO'S ACTION IN EXCLUDING INTEREST IS CORRE CT. APEX COURT DECISION IN THE CASE OF PANDIAN CHEMICALS LTD IS VERY CLEAR ON THIS ASPECT. HOWEVER WHAT IS TO BE EXCLUDED IS 'INCOME AND NOT GROSS RECEIPT. IF THER E IS DIRECT EXPENSE ON EARNING INTEREST INCOME, THE SAME NEED TO BE REDUCED. HOWEV ER ONUS TO PROVE THAT ANY EXPENSE HAS DIRECT NEXUS WITH INTEREST INCOME IS ON THE APPELLANT. CONSIDERING THE SPECIAL BENCH DECISION IN THE CASE OF LALSONS, 89 ITD 25 AO IS DIRECTED TO ALLOW NETTING OFF OF INTEREST IF THERE IS DIRECT NE XUS. WITH THIS DIRECTION, THE ACTION OF THE AO IN EXCLUDING INTEREST INCOME FROM COMPUTA TION OF DEDUCTION UNDER SECTION 80 HHC IS CONFIRMED. 6. AGGRIEVED BY THE ORDER OF CIT(A), ASSESSEE IS NO W IN APPEAL BEFORE US. 6.1 BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER AND LD. CIT(A) AND FURTHER SUBMITTED THAT I SSUE IN THE PRESENT GROUND IS NOW COVERED IN FAVOUR OF ASSESSEE BY THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF NIRMA INDUSTRIES LTD. VS. DCIT REPO RTED AT (2006) 283 ITR 402 (GUJ.), COMMISSIONER OF INCOME-TAX V. NIRMA LTD. R EPORTED AT [2014] 367 ITR 12 (GUJ.) AND THE DECISION IN CASE OF ACG ASSOCIAT ES CAPSULES PVT. LTD. VS. CIT [2012] 343 ITR 89 (SC). SHE, THEREFORE, SUBMITTED THAT IN VIEW OF AFORESAID DECISIONS, THE MATTER MAY BE RESTORED BACK TO THE F ILE OF ASSESSING OFFICER WITH NECESSARY DIRECTIONS . LD. D.R. DID NOT OBJECT TO THE AFORESAID SUBMISSIONS MADE BY ASSESSEE. ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 5 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO DE DUCTION U/S.80HHC OF THE ACT. WE FIND THAT ASSESSEE HAD RECEIVED INTEREST FROM BANK AND ON ACCOUNT OF LATE PAYMENT FROM CUSTOMERS. THE AFORESAID GROSS INTERE ST RECEIVED BY THE ASSESSEE WAS EXCLUDED BY THE AO FROM THE BOOK PROFIT FOR COM PUTING DEDUCTION U/S.80HHC OF THE ACT. WHILE DICTATING THE ORDER, O N THE ISSUE AS TO WHETHER GROSS INTEREST OR NET INTEREST IS TO BE EXCLUDED FOR WORK ING AT DEDUCTION U/S.80HHC OF THE ACT, WE HAVE COME ACROSS THE DECISION OF HONB LE AEX COURT IN THE CASE OF LIBERTY FOOTWEAR CO. VS. CIT REPORTED AT [2016] 383 ITR 195 (SC), WHEREIN THE HONBLE APEX COURT HAS HELD AS UNDER:- EXPORT SPECIAL DEDUCTION COMPUTATION OF PROFITS NINETY PER CENT . OF NET INTEREST INCLUDED IN PROFITS , AND NOT OF GROSS INTEREST TO BE DEDUCTED INCOME-TAX ACT, 1961, S. 80HHC, EXPLN. (B AA). NINETY PER CENT, OF NOT THE GROSS INTEREST BUT ONLY THE NET INTEREST WHICH HAS BEEN INCLUDED IN THE PROFITS OF BUSINESS OF THE ASSESSEE AS COMPUTED UNDER THE HEAD 'PROFITS AND GAINS OF BUSINESS OR PROFESSION', IS T O BE DEDUCTED UNDER CLAUSE (1) OF EXPLANATION (BAA) TO SECTION 80HHC OF THE INCOME -TAX ACT, 1961, FOR DETERMINING THE PROFITS OF THE BUSINESS. ACG ASSOCIATED CAPSULES (P.) LTD . V. CIT [2012] 343 ITR 89 (SC) FOLLOWED. 7.1. IN THE PRESENT CASE, WE FIND THE AO HAS EXCLUD ED 90% OF GROSS INTEREST FOR COMPUTING THE DEDUCTION U/S.80HHC OF THE ACT. IN VIEW OF AFORESAID DECISION OF HONBLE APEX COURT, WE ARE OF THE VIEW THAT THE ISS UE OF DEDUCTION U/S.80HHC OF THE ACT NEEDS TO BE RE-EXAMINED AT THE END OF AO. WE, THEREFORE, REMIT THE ISSUE OF DEDUCTION U/S.80HHC OF THE ACT BACK TO THE FILE OF A.O. TO DECIDE IT AFRESH IN THE LIGHT OF THE AFORESAID DECISION OF HONBLE AP EX COURT AND IN ACCORDANCE WITH LAW. NEEDLESS TO STATE THAT ASSESSING OFFICER SHALL GRANT ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE AND ASSESSE E IS ALSO DIRECTED TO CO-OPERATE ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 6 BY PROMPTLY FURNISHING ALL THE REQUIRED DETAILS CAL LED FOR BY A.O. THUS, THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPO SES. 8. GROUND NO.3 IS WITH RESPECT TO DISALLOWANCE OF P F EXPENSES. 9. DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS A ND ON PERUSING TAX AUDIT REPORT, ASSESSING OFFICER NOTICED THAT THE EMPLOYEE S CONTRIBUTION OF PROVIDENT FUND AMOUNTING TO RS.19,233/- WAS DEPOSITED WITH TH E APPROPRIATE AUTHORITIES AFTER THE DUE DATE BY THE ASSESSEE. HE ACCORDINGLY CONSIDERED IT AS INCOME AS PER PROVISIONS OF SECTION 2(24)(X) R.W.S. 36(1)(VA) OF THE ACT. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE T HE LD. CIT(A) WHO DECIDED THE ISSUE AGAINST THE ASSESSEE BY HOLDING AS UNDER: 5.3 I HAVE CONSIDERED THE FACTS OF THE CASE, APPEL LANT'S SUBMISSION AND ASSTT. ORDER. A.O. A.O. MADE ADDITION OF RS.21001/- BEING EMPLOYER'S CONTRIBUTION TOWARDS PF. AND RS. 19233/- BEING EMPLOYEE'S CONTRI BUTION TO PF NOT PAID WITHIN DUE DATES PRESCRIBED IN PF ACT. (A)AS REGARDS EMPLOYER'S CONTRIBUTION TO PF A.O. MA DE THE ADDITION OF EMPLOYER'S CONTRIBUTION TO PROVIDENT FUND AMOUNTING TO RS.21001/-. THE ISSUE IS WHETHER EMPLOYERS CONTRIBUTION IS ALLOWABLE U/S 43 B(B) IF THE SAME IS PAID BEFORE DUE DATE OF FILING THE RETURN. FROM A.Y. 20 04-05, SECOND PROVISO TO SEC. 43B IS DELETED. WHETHER THIS AMENDMENT WILL HAVE RE TROSPECTIVE EFFECT OR NOT IS THE CRUCIAL ISSUE. HON'BLE S.C. IN THE CASE OF VINAY CEMENT LTD HAS HELD THAT THE AMENDMENT IS RETROSPECTIVE AND WILL APPLY TO EARLIER YEARS ALSO. EVEN IN LATER JUDGMENT, HON'BLE S.C. IN THE CASE OF CIT.VS. ALTHOM EXTRUSION LTD. 319 ITR 306 RULED THAT OMISSION OF 2ND PROVISO TO SEC. 43B AND AMENDMENT OF 1ST PROVISO BY FINANCE ACT, 2003, BRINGING ABOUT UNIFORMITY IN PAYMENT OF TAX DUTY ETC. ON ONE HAND AND CONTRIBUTIONS TO EMPLOYER 'S WELFARE FUND ON THE OTHER ARE CURATIVE IN NATURE AND THUS EFFECTIVE RETROSPEC TIVELY. RESPECTFULLY FOLLOWING THE DECISIONS OF THE APEX COURT, A.O. IS DIRECTED T O ALLOW EMPLOYER'S CONTRIBUTION PAID BY THE APPELLANT BEFORE DUE DATE OF FILING RET URN. (B) AS REGARDS, EMPLOYEE'S CONTRIBUTION WHICH IS AL LOWABLE U/S 36(I)(VA) THE AMENDMENT IN SEC. 43B ON WHICH VARIOUS JUDICIAL DEC ISIONS AS REFERRED EARLIER , IS NOT APPLICABLE TO EMPLOYEE'S CONTRIBUTION. ON A PLA IN READING OF SEC. 43B WHICH ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 7 RESTRICTS THE ALLOWANCE OF EXPENSES WHICH ARE OTHER WISE ALLOWABLE UNDER THE ACT. THE ITEMS COVERED U/S 43B ARE LISTED FROM CLAUSE- A TO F. EMPLOYEE'S CONTRIBUTION TO PF. OR OTHER EMPLOYEES' WELFARE FUND IS NOT COVE RED IN ANY OF THE CLAUSE MENTIONED IN SEC. 43B. EMPLOYER'S CONTRIBUTION MENT IONED IN CLAUSE-B AND THEREFORE, EMPLOYER'S CONTRIBUTION IS ONLY SUBJECT TO SEC.43B. SINCE, IT IS OTHERWISE ALLOWABLE U/S 37(1) OF IT ACT. SINCE, PRO VISION OF SEC. 43B IS NOT AT ALL RELEVANT FOR EMPLOYEE'S CONTRIBUTION; THE DECISIONS BASED ON AMENDMENT TO SEC.43B CANNOT BE APPLIED TO EMPLOYEE'S CONTRIBUTIO N. IT IS NOT IN DISPUTE FROM EMPLOYEES WELFARE, BOTH EMPLOYEE AND EMPLOYER CONT RIBUTE. EMPLOYER'S CONTRIBUTION IS ALLOWABLE AS DEDUCTION ONLY IF THE SAME IS PAID BEFORE THE DUE DATE OF FILING THE RETURN. HOWEVER, EMPLOYEE'S CONT RIBUTION IS TREATED AS INCOME U/S 2(24)(X) AND THE SAME IS ALLOWED AS EXPENSE IF IT IS PAID WITHIN DUE DATE PROVIDED IN PF.ACT. IF THE PAYMENT IS NOT MADE WITH IN DUE DATE THEN THE EXPENSES IS NOT ALLOWABLE U/S 36(1)(VA). SINCE, THE EMPLO YEE'S CONTRIBUTION IS ALLOWABLE ONLY WHEN THE PAYMENT IS MADE WITHIN DUE DATE MENTI ONED IN PF.ACT., THE SAME BECOMES DISALLOWABLE IF PAYMENT IS MADE AFTER DUE D ATE AND ACCORDINGLY, THE SEC. 43B CANNOT BE APPLIED. THEREFORE, MIXING EMPLOYEE'S CONTRIBUTION TO PF ALONG WITH EMPLOYER'S CONTRIBUTION IS DISREGARDING THE CL EAR AND UNAMBIGUOUS PROVISIONS OF IT ACT. EVEN N OTHERWISE, IF PROVISI ONS OF SEC. 43B ARE APPLIED TO EMPLOYEE'S CONTRIBUTION, IT WILL MAKE SEC. 36(I)(VA ) REDUNDANT. FOR EXAMPLE U/S 36(I)(VA) ANY PAYMENT MADE AFTER 20 DAYS FROM THE E ND OF THE MONTH IS NOT ALLOWABLE, WHICH MEANS PAYMENT OF EMPLOYEE'S CONTRI BUTION TO PF AFTER 20 TH APRIL FOLLOWING THE END OF PREVIOUS YEAR WILL NOT B E ALLOWABLE, WHEREAS IF THE EMPLOYEE'S CONTRIBUTION IS CONSIDERED U/S 43B THEN THE SAME IS ALLOWABLE TILL THE DUE DATE OF FILING THE RETURN. IN VIEW OF THIS, IF SEC.43B, IS APPLIED TO EMPLOYEE'S CONTRIBUTION, IT WILL MAKE PROVISIONS OF SEC. 36(I) (VA) REDUNDANT. THE RULE OF HARMONIOUS CONSTRUCTION SAYS THAT INTERPRETATION TO THE STATUTE SHOULD BE SUCH THAT IT SHOULD NOT RENDER ANY PROVISION REDUNDANT. SINCE, THERE IS A CLEAR PROVISION FOR DISALLOWANCE OF EMPLOYEE'S CONTRIBUTI ON; THE SAME CANNOT BE MADE REDUNDANT BY LINKING IT WITH SEC.43B. IN VIEW OF TH IS, IT IS CLEAR THAT ALL THE DECISIONS INTERPRETING THE APPLICABILITY OF SEC. 43 B WHERE EMPLOYEE'S CONTRIBUTION IS ALSO LOOSELY MENTIONED, DO NOT APPLY TO EMPLOYEE 'S CONTRIBUTION COVERED U/S 36(I)(VA). IT IS TRUE THAT THERE ARE CONFLICTING DE CISIONS WHEREIN EMPLOYEE'S CONTRIBUTION IS ALSO CLUBBED WITH THE EMPLOYER'S CO NTRIBUTION. HOWEVER THERE IS NO JURISDICTIONAL HIGH COURT DECISION ON THIS ISSUE AFTER AMENDMENT TO SECTION 43B. ON THE ISSUE OF RULE OF INTERPRETATION OF STAT UTE, THERE ARE SEVERAL DECISIONS HOLDING THE VIEW THAT THERE SHOULD BE HARMONIOUS CO NSTRUCTION WHILE INTERPRETING STATUTE. SOME OF THIS ARE- 1-ASSAM CO. LTD VS STATE OF ASSAM AND OTHERS, 248 I TR 567 (SC) 2-LIC OF INDIA VS CIT, 219 ITR 410 ( SC) 3-CIT VS S E UPPER SILERU, 152 ITR 752 (AP) ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 8 IF THE ABOVE RATIONAL AND LOGIC IS FOLLOWED, THERE IS NO CONFUSION OVER APPLICABILITY OF THE CORRECT PROVISION FOR EMPLOYEE 'S CONTRIBUTION. IN VIEW OF THE CLEAR PROVISIONS AND LEGISLATIVE INTENT, THE EMPLOY EE'S CONTRIBUTION IS ALLOWABLE ONLY IF THE SAME IS PAID WITHIN DUE DATES UNDER PF. ACT. SINCE, THERE HAS BEEN DELAY IN PAYMENT FOR THE ENTIRE AMOUNT OF RS.19233/ -, THE SAME IS NOT ALLOWABLE U/S 36 (1) (VA). ADDITION OF RS.1,9233/- IS THEREFO RE CONFIRMED. 10. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFORE US. 10.1 BEFORE US, LD. A.R. AT THE OUTSET, FAIRLY SUBM ITTED THAT THIS GROUND NEEDS TO BE DECIDED AGAINST THE ASSESSEE IN VIEW OF THE DECI SION OF HONBLE GUJARAT HIGH COURT IN CASE OF CIT VS. GUJARAT STATE ROAD TRANSPO RT CORPORATION (2014) 366 ITR 170 (GUJ). LD. D.R. ON THE OTHER HAND SUPPORTE D THE ORDERS OF A.O. AND LD. CIT(A). 11. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO D EPOSIT OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND AFTER THE PRESCRIBED DUE DATE. WE FIND THAT HONBLE GUJARAT HIGH COURT IN CASE OF CIT VS. GUJARAT STATE ROAD TR ANSPORT CORPORATION (SUPRA) HAS DECIDED THE ISSUE AGAINST THE ASSESSEE AND IT H AS HELD AS UNDER: 'ANY SUM WITH RESPECT TO THE EMPLOYEES CONTRIBUTION AS MENTIONED IN S. 36(L)(VA), ASSESSEE SHALL BE ENTITLED TO THE DEDUCTION OF SUCH SUM TOWARDS THE EMPLOYEES CONTRIBUTION IF THE SAME IS DEPOSITED IN THE ACCOUN TS OF THE CONCERNED EMPLOYEES AND IN THE CONCERNED FUND SUCH AS PROVIDENT FUND, E SI CONTRIBUTION FUND, ETC PROVIDED THE SAID SUM IS CREDITED BY THE ASSESSEE T O THE EMPLOYEES ACCOUNTS IN THE. RELEVANT FUND OR FUNDS ON OR BEFORE THE 'DUE D ATE' UNDER THE PROVIDENT FUND ACT, ESI ACT, RULE, ORDER OR NOTIFICATION ISSUED TH EREUNDER OR UNDER ANY STANDING ORDER, AWARD, CONTRACT OR SERVICE OR OTHER WISE. ..' 12. IN VIEW OF THE UNDISPUTED FACT THAT THE EMPLOY EES CONTRIBUTION OF PROVIDENT FUND HAS NOT BEING PAID BEFORE THE DUE D ATES, IN THE ABSENCE OF ANY CONTRARY BINDING DECISION IN FAVOUR OF ASSESSEE AN D RESPECTFULLY FOLLOWING THE DECISION OF HON'BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. GUJARAT STATE ROAD ITA NO. 930/AHD/12 A.Y. 2003-04 (BLOOM DE KOR LIMITED VS. DCIT) 9 TRANSPORT CORPORATION (SUPRA), WE SET ASIDE THE ORD ER OF LD. CIT(A) ON THIS ISSUE AND UPHOLD THE DECISION OF A.O. THUS, THIS GROUND OF ASSESSEE IS DISMISSED. 13. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 08 - 06 - 201 6. SD/- SD/- ( RAJPAL YADAV) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT M EMBER AHMEDABAD: DATED 08/06/2016 S K SINHA/TC NAIR COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) VI AHMEDABAD 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER //TRUE COPY// DEPUTY/ASSTT.REGISTRAR ITAT, AHMEDABAD 1.DATE OF DICTATION 02.06.2016 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E OTHER MEMBER 03 -06-2016 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S .8.6.16 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK ..8.6.16 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER