At, Income Tax Appellate Tribunal Cuttack
By, THE HONOURABLE MR. N.S. SAINI
By, ACCOUNTANT MEMBER & THE HONOURABLE MR. PAVAN KUMAR GADALE
By, JUDICIAL MEMBER
For the Appellant: P.K. Sahu, AR. For the Respondent: D.K. Pradhan, DR.
1. N.S. Saini, AM This is an appeal filed by the assessee against the order of the CIT(A)-1 Bhubaneswar dated 2.1.2018 for the assessment year 2014-15.
2. Ground No.1 of appeal reads as under:
"1. The order of learned Commissioner of Income Tax(Appeals)-1 Bhubaneswar confirming the addition of Rs 26,14,999/- made by the ITO WARD 2(3) BHUBANESWAR in computing the business income of the assessee is arbitrary to law and the facts of the case. Actually these payments are employees contribution towards provident fund which has not been deposited to govt, in time as per relevant law but deposited before due date for filing income tax return .This is well settled case of CIT VS Alom EXTRUSIONS Ltd. (2009) 319 ITR 305 (SC) that employees contribution towards EPF deposited after due date but before the time allowed for filing the return u/s 139(1) will not call for any disallowance."
3. The facts of the case are that the Assessing Officer found that the assessee has not deposited an amount of Rs.26,14,999/- towards employees contribution to PF within the prescribed under the PF Act and, therefore, made addition to the income of the assessee.
4. On appeal, the CIT(A) confirmed the action of the Assessing Officer following the decision of Hon'ble Gujarat High Court in the case of Gujarat State Road Transport Corporation, 366 ITR 170(Guj) and the CBDT Circular No.22 of 2015 dated 17.12.2015.
5. Before us, ld A.R. submitted that as the employees contribution is deposited before the due date of filing return of income u/s.139(1), therefore, same deserves to be allowed.
6. Ld D.R. supported the orders of lower authorities.
7. We have heard the rival submissions, perused the orders of lower authorities and materials available on record. In the instant case, the Assessing Officer has disallowed Rs.26,14,999/- u/s.2(24)(x) r.w.s 36(1)(va) of the Act towards employees contributions to PF as the same were not deposited within the due date prescribed under the Act.
8. On appeal, the CIT(A) confirmed the action of the Assessing Officer.
9. On perusal of assessment order at page 2 to 4, we find that the assessee has deposited the employees' contribution to PF before filing of the return of income u/s.139(1) of the Act. We find that the Hon'ble
Supreme Court in the case of Pr. CIT vs Rajasthan Beverage Corporation Ltd., (2017) 84 Taxman. Com 185 (SC), has held as under:
"Section 43B, read with section 36(1)(va), of the Income Tax Act, 1961-Business disallowance-certain deduction to be allowed only on `actual payment (PF & ESI construction)- High Court by the impugned order held that amount claimed on payment of PF and ESI having been deposited on or before due date of filing of returns, same could not be disallowed under section 43B or under section 36(1)(va)- Whether SLP against said impugned order was to be dismissed-Held yes (para 2) in favour of assessee.
10. Respectfully following the decision of Hon'ble Supreme Court in the case of Rajasthan Beverage Corporation Ltd., (supra), we delete the addition of Rs26,14,999/- made by the Assessing Officer and sustained by the CIT(A) and allow this ground of appeal of the assessee.
11. Ground No.2 of appeal reads as under:
2. The learned Commissioner of Income tax (APPEALS)-1 Bhubaneswar confirmed the disallowance amounting to Rs 96,605/- representing service tax and employers contribution towards EPF and ESI made by learned ITO u/s 43B is bad in law and is not ju
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stified .The same can be claimed in the year of payment." 12. We find that the assessee has not pressed this issue before the CIT(A) and, therefore, same was dismissed by the CIT(A). Before us also, no argument was advanced by ld A.R. of the assessee on this ground also. Therefore, this ground is dismissed. 13. In the result, appeal filed by the assessee is partly allowed.