TMI Blog2021 (10) TMI 1045X X X X Extracts X X X X X X X X Extracts X X X X ..... ady assessed in the assessment order dated 31/08/2017 and to pass the consequential order accordingly, cannot survive. Assessee during the course of argument also raised an issue that Assessee s return of income was selected for scrutiny under CASS but for limited purposes i.e. other deductions and other expenses claimed in the profit loss account (as reflected in notice u/sec. 143(2) of the Act, dated 27/07/2016). The Assessee s contention is that once the case is selected for limited scrutiny and not covering the issue other than involved for the limited purposes as specified in the notice, then the revenue authorities are not entitled to travel beyond the parameters except while following the due procedure prescribed as per law and instructions issued by the CBDT instructions No.20/2015, dated 29/12/2015 and 05/2016, dated 14/07/2016 etc., but not otherwise. The Assessee also relied upon the order passed by the coordinate bench of the tribunal in the case of M/s. Suraj Diamond Dealers Pvt. Ltd. [ 2019 (12) TMI 26 - ITAT MUMBAI] . As perused the other expenses and deductions debited in the profit loss account and the expenditure incurred and specified in the profit lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the assessment order dated 31/08/2017 as erroneous and prejudicial to the interest of the revenue and accordingly directed the AO to make the addition of ₹ 1,34,401/- u/sec. 2(24)(x) of the Act to the income already assessed in the assessment order, while relying upon the judgment of the Hon'ble Gujarat High Court in the case of CIT Vs. Gujarat State Road Transport Corporation (265 CTR 64) wherein it was held that when the Assessee has not deposited the employees contribution in the PF account before the due date provided under the PF Act and/or ESI Act, the Assessee shall not be entitled to deduction u/sec. 36(1)(va) of the Act, though the Assessee might have deposited employees contribution on or before due date of filing of the return u/sec. 139 of the Act. 3. The Assessee is in appeal against the impugned order. 4. Having heard the parties and perused the material available on record. It is not in controversy that there is plethora of judgments in favour of the Assessee s contention and of the Revenue. The controversy with regard to divergent views of different High Courts, has been settled by the Hon'ble Apex Court in the case of CIT Vs. M/s. Vegetable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PF shall be allowed, if the same is paid on or before the due date of filing of return of income u/s 139(1) of the Act. 6. The only issue to be resolved is whether the assessee would be entitled to claim deduction for the employees contribution made to PF after the due date prescribed under the PF Act, but before the due date prescribed for filing of income tax return in the light of the provisions contained in section 36(1)(va) of the Act and section 43B(b) of the Act. It is the contention of the assessee that there is no distinction between employer and employee contribution after omission of second proviso of section 43B of the Act by Finance Act, 2003 w.e.f. 1.4.2004. We find force in the arguments of the assessee for the reason that there is no difference between employees and employer contribution under the PF Act. Section 6 of Provident Fund Act provides for contribution and the manner in which such contribution shall be made. Paragraph 30 of the PF Scheme provides for payment of contributions. As per the said scheme, the employer at the first instance shall make the total contribution including employees share. Paragraph 32 provides for recovery of member share of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8. The Hon ble Karnataka High Court, in the case of Essae Teraoka (P) Ltd. Vs. DCIT 366 ITR 408 took the view that the word contribution occurring in section 43B of the Act would include employees contribution to PF in the light of the definition of the word contribution as per the provisions of section 2(c) of the PF Act. As per the said section, contribution would mean both employer s contribution and employees contribution. Accordingly, it was held that the provisions of section 43B of the Act allowing deduction for payment made before the due date of filing of Income Tax return cannot be ignored. Similarly, the ITAT, Hyderabad Tribunal in the case of Tetra Soft (India) Pvt. Ltd. Vs. ACIT (2015) 40 ITR (Trib) 470 held that when assessee remitted employees contribution to PF within due date of filing return of income u/s 139(1) of the Act, amount of employees contribution to PF cannot be disallowed. Similar view was upheld by the Chennai bench of the ITAT, in the case of ACIT Vs. Farida Shoes Pvt. Ltd. (2016) 46 CCH 29. The coordinate bench held that if assessee had not deposited employees contribution towards provident fund up to the due date as prescribed under rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of furnishing return of income u/s 139(1) of the Act, then no disallowance can be made towards employees contribution to provident fund. The CIT(A) after considering the relevant details rightly deleted the additions made by the A.O. We do not see any reasons to interfere with the order of the CIT(A). Hence, we inclined to uphold the CIT(A) order and dismiss the appeal filed by the revenue. 5. We may observe that an order cannot be termed as erroneous unless it is not in accordance with law. If assessing officer makes assessment in accordance with law, the same cannot be branded as erroneous by the commissioner. The Commissioner is not empowered to substitute his view to the view already taken by the AO in accordance with law or judgements of the higher Courts. In the instant case the AO in view of the decisions of the Hon ble High Courts, had taken the plausible and favourable view to the Assessee, while considering the expenses qua employees contribution to the provident fund deposited on or before due date of filing of return u/sec. 139(1) of the Act, and hence the assessment order can not be termed as erroneous and prejudicial to the interest of the revenue. Conseq ..... X X X X Extracts X X X X X X X X Extracts X X X X
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