TMI Blog2017 (3) TMI 1870X X X X Extracts X X X X X X X X Extracts X X X X ..... - As per revenue CIT (A) erred in relying on the provisions of section 43B (b) of the I.T.Act, whereas the present issue is involved with Section 36(1) (va) read with 2 (24) (x) - HELD THAT:- We are of the view that there is merit in the submissions of ld. AR for the assessee, as the proposition canvassed by ld. AR for the assessee are supported by the facts narrated by him above. Ld. AR for the assessee has rightly pointed out that as per Tax audit report column No.16(b) Annexure-B, which clarified that employees` contribution to PF ₹ 2,30,271/- for January 2011 was paid on 23.02.2011, that is, next Month. Therefore, the assessee did not commit and default in depositing the PF contribution even as per section 36(1) (va) r.w.s 2(24) (x) of the I.T.Act. Considering the factual position, we do not find any infirmity in the order passed by the ld CIT(A). Therefore, we confirm the order passed by ld.CIT(A). - Decided against revenue. - IT(SS)A No. 42/Kol/2015 - - - Dated:- 15-3-2017 - Shri A.T. Varkey, JM Dr. A.L. Saini, AM For the Revenue : Shri G.Mallikarjuna, CIT-DR For the Assessee : Shri Subash Agarwal, Advocate ORDER Per Dr. Arjun Lal Saini, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as on those of search assessment. I find support from the decision of the Hon'ble Special Bench of the ITAT in the case of All Cargo Global Logistics Ltd in ITA No 5018 to 5022 5059/M/10 wherein it was held that (a) In assessments that are abated, the AO retains the original jurisdiction as well as jurisdiction conferred on him u/s 153A for which assessments shall be made for each of the six assessment years separately; (b) In other cases, in addition to the income that has already been assessed, the assessment u/s 153A will be made on the basis of incriminating material, which in the context of relevant provisions means - (i) books of account, other documents, found in the course of search but not produced in the course of original assessment, and (ii) undisclosed income or property discovered in the course of search . I therefore hold that the AO in the present case had jurisdiction to make additions on items of regular assessment. Ground no 1 is dismissed. 8. The Ld AR has argued that the AO was not justified in disallowing the NPV of ₹ 12,14,61,050/- on the ground that the same was nonIT( revenue in nature. I have considered the arguments of the Ld AR and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Mumbai Bench of the ITAT has in, the case of IDBI vs DCIT 91 ITD 34 held that expenditure by assessee in accordance with statutory guidelines is allowable business expenditure. In the case of CIT vs Rungta Mines (P) Ltd 205 ITR 335, the jurisdictional High Court has held that where a trader by compulsion of statutory obligation has to incur an expenditure as a compelling requisite for carrying on his trade, the expenditure resulting in a capital asset in the hands of a third party, is to be taken as revenue expenditure because no asset arises to the trader by reason of such expenditure. It was further held that where law imposes on the assessee an obligation to incur expenses for being permitted to pursue its trading activity, the expenditure would be an outgoing from the profits of the trade. I also note that by making the payment of NPV, no tangible asset came into existence. And further, the said payment was not voluntary as it was a pre-condition to enable the assessee to carry on its mining activities. Also, as the payment of NPV being statutory requirement had to be paid by the assessee to continue to carry on its mining activities, I am of the considered view that such p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse of the appellate proceedings. I find merit in the contention of the ld AR that the issue is covered in favour of the assessee by the judgment of the jurisdictional High Court in the case of CIT vs M/ s Vijay Shree Ltd (ITAT No 245 of 2011 GA No 2607 of 2011 wherein it was held that : The only issue involved in this appeal is as to whether the deletion of the addition by the Assessing Officer on account of Employees' Contribution to ESI and PF by invoking the provision of Section 36(1)(va) read with Section 2 (24) (x) of the Act was correct or not. It appears that the Tribunal below, in view of the decision of the Supreme Court in the case of Commissioner of Income Tax vs Alom Extrusion Ltd, reported in 2009 Vol 390 ITR 306, held that the deletion was justified. Being dissatisfied, the Revenue has come up with the present appeal. After hearing Mr Sinha, Ld advocate, appearing on behalf of the appellant and after going through the decision of the Supreme Court in the case of Commissioner of Income Tax vs Alom Extrusion Ltd, we find that the Supreme Court in the aforesaid case has held that the amendment to the second provision the Sec 43B of the Income Tax Act, as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of NPV, no tangible asset came into existence. And further, the said payment was not voluntary as it was a pre-condition to enable the assessee to carry on its mining activities. Also, as the payment of NPV being statutory requirement had to be paid by the assessee to continue to carry on its mining activities, therefore such payment is wholly and exclusively for the purposes of carrying on the business. The incurring of such expenses should therefore be considered as having direct nexus with the business activities of the assessee. The assessee by making payment of NPV got no fresh right to mining but the said payment was made to overcome restriction or obstruction or disability that had arisen in continuing of the mining business. Merely because it was one-time payment, it could not be considered as capital in nature. Besides, the said issue is covered by assessee`s own case in ITA No.933/Kol/2009 wherein the Tribunal treated the said expenditure as revenue in nature. 5.3 Having heard the rival submissions, perused the material on record, we are of the view that there is merit in the submissions of ld. AR for the assessee, as the proposition canvassed by ld. AR for the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vol.319 ITR 306, held that the deletion was justified. Being dissatisfied, the Revenue has come up with the present appeal. After hearing Mr. Sinha, learned advocate, appearing on behalf of the appellant and after going through the decision of the Supreme Court in the case of Commissioner of Income Tax vs. Alom Extrusion Ltd., we find that the Supreme Court in the aforesaid case has held that the amendment to the second proviso to the Sec 43(B) of the Income Tax Act, as introduced by Finance Act, 2003, was curative in nature and is required to be applied retrospectively with effect from 1st April, 1988. Such being the position, the deletion of the amount paid by the Employees' Contribution beyond due date was deductible by invoking the aforesaid amended provisions of Section 43(B) of the Act. We, therefore, find that no substantial question of law is involved in this appeal and consequently, we dismiss this appeal. 6.2. On the other hand, Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 6.3. Having heard th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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