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2015 (7) TMI 861 - ITAT AHMEDABAD

2015 (7) TMI 861 - ITAT AHMEDABAD - TMI - Disallowance u/s 43B - late payments of employees’ contribution to the PF fund - Held that:- The issue in dispute is squarely covered against the assessee by the decision of Gujarat Road Transport Corporation reported in [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein held that employees’ contribution if not paid within the due date provided in the PF and ESI Act then, deduction will not be admissible to the assessee. The view of the ld. Commissioner of .....

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ellant's unit eligible for deduction under section 10 B. Since by disallowing expenses on account of non-deduction of TDS or not depositing TDS to government account in time, assessing officer only increased business profit. Such increased business profit is eligible for deduction under section 10 B, appellant is eligible for deduction under section 10 B for addition of expenses disallowed under section 40(a) (ia) of IT Act. Accordingly the disallowance of expense on account of default under TDs .....

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T(A) deleted the addition - Held that:- A specific deduction was made from the salary and after collecting that amount it was given as a donation. The assessee has not claimed any deduction as such from its business profit, the amount collected from the employees’ salaries does not involve element of income in the hands of assessee because the assessee has only acted as a facilitator between the amounts collected vis-à-vis remitted to the flood victims. Therefore, ld. Commissioner of Income Tax .....

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out that appeal of the assessee is time barred by 42 days. The assessee has filed an application for condonation of delay. On due consideration of the application of the assessee coupled with the fact that order of the Commissioner of Income Tax (Appeals) is under challenge before the Tribunal in the appeal of revenue also, It is open for discussion and assessee could file cross objection on receipt of notice in the revenue s appeal. We condone the delay and proceed to decide both the appeals on .....

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98,361/- after claiming deduction u/s. 10B of ₹ 5,12,42,970/-. The assessee had declared total software turnover of ₹ 17.69 crore and claimed exemption u/s. 10B of ₹ 5,12,42,970/-. The case of the assessee was selected for scrutiny assessment and a notice u/s. 143(2) was issued and served upon the assessee. On scrutiny of the accounts, it revealed to the Assessing Officer that assessee has received contributions from the employees for the provident funds and ESI. However, it fa .....

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e deduction, otherwise ought to be admissible to the assessee. Income tax act, section 36(1)(va) provides that if payments made after 20 days from the end of the month then it is not, allowable. In other words, the payments of employees contribution to the PF fund after 20th April following the end of previous year will not be allowable to the assessee. The ld. Assessing Officer therefore disallowed the claim of the assessee. 5. Appeal to the Commissioner of Income Tax (Appeals) did not bring an .....

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iew of the ld. Commissioner of Income Tax (Appeals) is in line with the hon ble High Court s decisions therefore, we do not find any merit in this ground of appeal. No other grounds in the appeal of assessee are pressed. Accordingly, it is dismissed. Now we take up ITA No. 1506/Ahd/2011 7. The revenue has taken five grounds of appeal. Out of which ground no. 4 and 5 are general grounds of appeal, which do not call for recording of any finding, hence rejected. Ground no. 1, 2 and 3 are inter-conn .....

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ich tax at source was not deducted. 3. The Ld. Commissioner of Income-tax (A) has erred in law and on facts in directing the Assessing Officer to verify the contentions of the Assessee, in respect of disallowance of ₹ 1,00,430/- being contribution to Surat Flood Victim , in contravention of Sec. 251 of the Income Tax Act, 1961 , the direction amounting to setting-aside the issue to the file of the Assessing Officer." 8. As stated earlier, assessee is a 100% export oriented unit with s .....

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He accordingly, disallowed the claim of assessee. On appeal, Ld. First Appellate Authority, has observed that once this expenditure is to be added in the total income of the asessee then, it will enhance the business profit and accordingly assessee will be entitled for exemption u/s. 10B of the Act and it will be revenue neutral. There will no variation in the ultimate taxability of the income of the assessee. Accordingly, ld. Commissioner of Income Tax (Appeals) did not go into merits of those .....

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on of the eligible profit for grant of exemption u/s. 10B. 10. With the assistance of ld. representatives we have gone through the record carefully. The details noticed by ld. Commissioner of Income Tax (Appeals) from the written submissions of the assessee and finding of Commissioner of Income Tax (Appeals) on this issue read as under: "A.O. had disallowed various expenses under section 40(a)(ia) of the income Tax Act. Which are as below: Amount of Disallowance Reason Assessee s Contention .....

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Ramjibhai Vs Income Tax Officer (2011) 49 DTR (Ahd Trib) 70 ₹ 4,94, 204 On account of TDS not deducted on Computer Rent u/s 1941 As per provision of the section this transaction is not covered under this section ₹ 98,652 On account of TDS not deducted on Audit Fees u/s 194J Bills of Fees and reimbursement expenses are separately and this transaction is not liable for TDS ₹ 7,43,053 On account of IDS not deducted on Consulting Fees u/s 194J The nature of transactions is for wor .....

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ras High Court in the case of Skycell Communication Ltd. V DCIT (2001) 119 Taxman 496 ₹ 56,500/- On account of TDS not deducted on Training Expenses u/s 194J The nature of transactions is for work contract, not for any technical and professional in nature and the same transaction is covered u/s 194C, not under 194J. Further there is no payment in aggregate exceed of ₹ 50000 and hence the same is not liable for TDS. Further no individual bills are in excess of ₹ 20000.. ₹ .....

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nt is eligible for deduction under section 10 B for addition of expenses disallowed under section 40(a) (ia) of IT Act. Accordingly the disallowance of expense on account of default under TDs provisions will not affect appellant's taxable income. In view of this, the applicability of TDS provisions and disallowance under section 40 (a) (ia) is not discussed here. However the addition on account of delayed payment of employee's contribution to PF/ESI is not made in business head. This add .....

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