TMI Blog2022 (4) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the return of income u/s. 139(1) Hon'ble jurisdictional High Court in case of Essae Taroka (P.) Ltd. [ 2014 (3) TMI 386 - KARNATAKA HIGH COURT] and Spectrum Consultants India (P.) Ltd. [ 2013 (7) TMI 414 - KARNATAKA HIGH COURT] has affirmed the above view. In view of the judicial pronouncements cited supra, we hold that the amendment to section 36(1)(va) and 43B of the I.T. Act will not have application for the relevant assessment year, namely assessment year 2019-2020. Accordingly, we direct the A.O. to grant deduction in respect of employees' contribution to PF and ESI since the assessee has made the payment before the due date of filing of return u/s. 139(1) of the I.T. Act. It is ordered accordingly. - ITA No. 448/Ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aka High Court in the case of Essae Teroka Limited reported in 366 ITR 408 [Kar] since the same has been paid before the due date for filing the return of income u/s. 139(1) of the Act and hence, the disallowance made ought to have been deleted. 4. The learned CIT[A]/NFAC is not justified in holding that the amendment made by insertion of Explanation 2 to the provisions of section 36[1][va] of the Act and the insertion of Explanation 5 to section 43B of the Act by the Finance Act, 2021 with effect from 01/04/2021 was clarificatory/declaratory in the nature and therefore, these amendments were retrospective in operation under the facts and in the circumstances of the appellant's case. 4.1 The learned CIT[A]/NFAC ought to have a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng loss of ₹ 80,99,675/-. The return was processed u/s. 143(1) of the I.T. Act. In the intimation issued u/s. 143(1) of the I.T. Act, the CPC disallowed the employees' contribution to PF and ESI to the tune of ₹ 17,10,174/-. The reason for making the disallowance was that the assessee did not remit the employees' contribution to PF and ESI within the due date specified under the respective Acts. 3. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). Before the Ld. CIT(A), it was submitted that the assessee remitted the employees contribution to PF and ESI before the due date of filing of the return u/s. 139(1) of the I.T. Act and in view of the judgment of the Hon'ble jurisdictional High Court Pr. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant finding of the Tribunal reads as follows:- 7. I have heard rival submissions and perused the material on record. Admittedly, the assessee has not remitted the employees' contribution of PF of ₹ 1,06,190 and ESI of ₹ 16,055 totaling to ₹ 1,22,245 before the due date specified under the respective Act. However, the assessee had paid the same before the due date of filing of the return u/s. 139(1) of the IT. Act. The Hon'ble jurisdictional High Court in the case of Essae Teraoka (P.) Ltd. v. DCIT reported in 366 ITR 408 (Kar.) has categorically held that the assessee would be entitled to deduction of employees' contribution to PF and ESI provided the payment was made prior to the due date of filing of ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he employer is entitled for deduction. 21. The submission of Mr. Aravind, learned counsel for the revenue that if the employer fails to deduct the employees' contribution on or before the due date, contemplated under the provisions of the PF Act and the PF Scheme, that would have to be treated as income within the meaning of Section 2(24)(x) of the IT Act and in which case, the assessee is liable to pay tax on the said amount treating that as his income, deserves to be rejected. 22. With respect, we find it difficult to endorse the view taken by the Gujarat High Court. WE agree with the view taken by this Court in W.A. No. 4077/2013. 23. In the result, the appeal is allowed and the substantial question of law framed by us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spective in nature and not retrospective. (i) Dhabriya Polywood Limited v. ACIT reported in (2021) 63 CCH 0030 Jaipur Trib. (ii) NCC Limited v. ACIT reported in (2021) 63 CCH 0060 Hyd Tribunal. (iii) Indian Geotechnical Services v. ACIT in ITA No. 622/Del/2018 (order dated 27.08.2021). (iv) M/s. Jana Urban Services for Transformation Private Limited v. DCIT in ITA No. 307/Bang/2021 (order dated 11th October, 2021) 7.3 In view of the aforesaid reasoning and the judicial pronouncements cited supra, the amendment to section 36(1)(va) and 43B of the I.T. Act by Finance Act, 2021 will not have application for the relevant assessment year, namely A.Y. 2019-2020. Accordingly, I direct the A.O. to grant deduction in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
