TMI Blog2021 (7) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... bution towards Provident Fund - addition u/s 2(24)(x) and section 36(1)(va) - CIT-A deleted the addition - HELD THAT:- Delayed payments of employee s contribution to Provident Fund/ESIC is allowable if it is deposited before the return is filed u/s 139(1). In view of the legal position on the issue and the order of the Hon'ble ITAT, Delhi in the appellant s own case [ 2017 (1) TMI 1598 - ITAT DELHI] the company is eligible for deduction made by the AO by invoking provisions of Section 36(1)(va) read with 2(24)(x) and 43B of the Act. The AO is, therefore, directed to delete the addition. Also see HC own case [ 2017 (9) TMI 1688 - DELHI HIGH COURT] - Decided in favour of assessee. - ITA No.5152/Del/2017 - - - Dated:- 15-7-2021 - Shri R.K. Panda, Accountant Member And Ms Suchitra Kamble, Judicial Member For the Assessee : Shri Ved Jain, Advocate For the Revenue : Shri Farhat Khan, Sr. DR ORDER PER R.K. PANDA, AM: This appeal filed by the Revenue is directed against the order dated 30th May, 2017 of the CIT(A)-7, New Delhi, relating assessment year 2014-15. 2. The first ground raised by the Revenue reads as under:- 1. On the facts and under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the orders of the AO and the CIT(A). We have also considered the various decisions cited before us. We find, the AO, in the instant case, disallowed the amount of ₹ 54,31,041/- being interest paid on late payment of service tax holding the same to be not an allowable expenditure. We find, the ld.CIT(A) deleted the disallowance holding that the interest on late payment of service tax is compensatory in nature. While doing so, he relied on the decision of the coordinate Bench of the Tribunal in the case of Messee Dusseldorf India (P) Ltd. (supra). We do not find any infirmity in the order of the CIT(A) on this issue. We find, the coordinate Benches of the Tribunal are consistently holding that interest paid for late deposit of the service tax is a permissible deduction. We find the coordinate Bench of the Tribunal in the case of Deepali Design Exhibits (P) Ltd. (supra) (to which one of us i.e., ld. Judicial Member is a party)while dismissing the appeal filed by the Revenue on identical issue has observed as under:- 7. We have heard both the parties and perused the material available on record. The CIT(A) held as under:- 9. I have considered the facts of the case an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds raised by the Revenue is dismissed. 11. Ground of appeal No.2 raised by the Revenue reads as under:- 2. On the facts and under the circumstances of the case, the Ld.CIT(A) has erred in law in deleting the addition of ₹ 8,85,62,590/- made by the AO without appreciating the fact that the assessee company did not comply with the provisions of section 2(24)(x) and 36(1)(va) of the Income Tax Act, 1961 on account of payments to be made on or before the due date as prescribed under the law of such funds on account of employees contribution towards provident Fund or any other fund mentioned u/s 2(24)(x). 12. Facts of the case, in brief, are that the AO, during the course of assessment proceedings, observed from the details contained in the tax audit report that the assessee company did not comply with the provisions of section 2(24)(x) and section 36(1)(va) on account of payments to be made on or before the due date as prescribed under the law of such funds on account of employees contribution towards Provident Fund or any other fund mentioned under section 2(24)(x). He, therefore, confronted the same to the assessee and asked the assessee to file the details. Reject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers Ltd., ITA No.4959/Del/2016, order dated 08.04.2021, submitted that similar disallowance on account of delay in deposit of employees contribution to Provident Fund and ESI fund was deleted. Referring to the decision of the Hon ble Delhi High Court in assessee s own case i.e., PCIT vs. Planman HR (P) Ltd., ITA 599/2017, order dated 11.09.2017, he submitted that under identical facts and circumstances, the Tribunal has upheld the order of the CIT(A) in deleting the disallowance made by the AO on account of delayed payment of contribution to Provident Fund and on further appeal by the Revenue the Hon ble High Court dismissed the appeal filed by the Revenue. He accordingly submitted that in view of the decision of the jurisdictional High Court in assessee s own case, the ground raised by the Revenue should be dismissed. 16. We have considered the rival arguments made by both the sides and perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find, the AO, in the instant case, made addition of ₹ 80,90,53,240/- on account of late payment of ESI and PF and professional t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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