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2019 (8) TMI 504

..... w facts were brought on record. The order of the tribunal was not reversed by the Hon’ble jurisdictional High court. Since the facts are identical and the Ld. CIT(A) allowed the appeal of the assessee following the order of this Tribunal in assessee’s own case for the A.Y 2009-10 and 2010-11 [2016 (11) TMI 1635 - ITAT VISAKHAPATNAM] we find no reason to interfere with the order of CIT(A) and accordingly, Ground Nos.2 to 4 are dismissed Employees contribution to PF u/s 36(1)(va) r.w.s. 2(24)(x) - delay in making payment - HELD THAT:- Assessee has remitted the Employees contribution to P.F beyond the due date specified under P.F Act, but before the due date for filing the return of income. This tribunal has consistently taken the .....

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..... ered by the I.T. Lokam Services. The assessing officer viewed that there is no nexus with the business of the assessee and accordingly disallowed the entire expenditure paid to M/s I.T.Lokam Services . On identical facts the same disallowance made in the earlier years which was allowed by the Tribunal. The detailed reasons for disallowance of expenditure discussed in the assessment order and for the sake of clarity we reproduce from para No.3 to 3.2 of the assessment order which reads as under : 3. It is seen from the Profit & Loss A/c that the assessee debited an amount of ₹ 88,91,065/- towards 'Consultancy charges' under the head 'Other expenses'. This amount has been paid to M/s. I T Lokam Services Pvt. Ltd., wh .....

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..... re such as Java/J2EE, DB2, Websphere technologies etc. The revenue from the supporting services is received from Indian Software Companies. The assessee company engages its own staff to render the said services and in case of short fall of the personal it takes support from the other companies who provide such kind of services. For executing the said contract it engages its own employees and out sourced persons, hence the expenditure for salaries (own staff) and consultancy charges (outsourced persons) appears in profit and loss account. 3.2. At the outset, the reply of the assessee was analyzed to be too general. The reply did not answer the specific query put forth to the assessee with regard to the specific consultancy received and its c .....

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..... ts subsidiary, M/s.IT Lokam Services Pvt. Ltd., it was held that the alleged expenditure towards consultancy charges purportedly paid to M/s IT Lokam Services Pvt. Ltd. has no nexus with the business of the assessee and holding thus, the expenditure towards consultancy paid was disallowed. The assessee had contested the said disallowance made for A.Ys.2009-10 & 2010-11, 2011-12 & 2012-13 before the Commissioner of Income-tax(Appeals), Visakhapatnam. 4. Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A) and the Ld.CIT(A) deleted the addition made by the AO following the order of this Tribunal in the assessee s own case for the A.Y.2009-10 and 2010-11.We extract the relevant part of the order of the Ld.CIT .....

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..... ct. This issue is also decided in the same order as under: Considering the facts and circumstances of the case and also respectfully following the coordinate bench decision, we are of the view that if employees contribution to provident fund is paid within the due date specified u/s 139(1) of the Act, then no disallowance can be made towards employees contribution to provident fund for the assessment year 2009-10 to 2011-12. 5.4. Respectfully following the decision in appellants own case, The Assessing Officer is directed to delete the addition of ₹ 5,37,791/ -. 5. During the appeal hearing the Ld.DR did not dispute the facts and no new facts were brought on record. The order of the tribunal was not reversed by the Hon ble jurisdictio .....

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..... eduction is allowable under the first proviso to section 43B if it is paid on or before the due date for filing the return of income. Thus the AO held that the deduction is not available to the assessee even if the same is paid before the due date for filing the return on income. Accordingly, the belated PF payments of employees contributions aggregating to ₹ 5,37,791/- are treated as income of the assessee u/s 36(1)(v) r.w.s. 2(24)(x) of the Act. 7. Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A) and the Ld.CIT(A) observed that though the assessee has remitted the employees contribution to PF beyond the due date provided in the PF Rules, it was remitted before the due date of filing the return of incom .....

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