TMI Blog2022 (1) TMI 1023X X X X Extracts X X X X X X X X Extracts X X X X ..... of income u/s 139(1) of the I.T.Act. It was further held by the ITAT that amendment by Finance Act, 2021, to section 36[1][va] and 43B of the Act is not clarificatory. Therefore, the amended provisions of section 43B as well as 36(1)(va) of the I.T.Act are not applicable for the assessment years under consideration - employees contribution paid by the assessee before the due date of filing of return of income u/s 139(1) of the I.T.Act is an allowable deduction. Accordingly, we decide this issue in favour of the assessee. - ITA No.458/Bang/2021 And ITA No.459/Bang/2021 - - - Dated:- 17-11-2021 - Shri Chandra Poojari, AM And Shri George George K, JM For the Appellant : Sri.Pranav Krishna, Advocate For the Respondent : Smt.P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eturn of Income u/s 139(1) of the Act. 5. The learned authorities below erred in ignoring the fact that as long as the contribution is made to the PF authorities before the due date for filing of the Income Tax Returns the same is required to be allowed. This view has been taken by jurisdictional High Court of Karnataka. 6. There is plethora of decisions by the honorable Jurisdictional High Court. The NFAC is bound by the decision of Jurisdictional Karnataka High Court as the Assessee is situated within the territorial jurisdiction of Karnataka, the learned authorities below erred in not following the Judgement relied on by the appellant from the facts and circumstances of the case is against the set law. 7. The learned CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 employee's contribution ESI/PF has been deposited by assessee employer before due date of filing section 139(1) return but after due date prescribed in corresponding statutes and Assessing Officer added said amount to income of assessee per provisions of section 36(1) (va), it was held that, since amendments section 36(1)(va) as well as 438 vide Finance Act, 2021 to this effect applies w.e.f 1-4-2021 only, impugned disallowance for assessment year 2019-20 was not sustainable. 11. Appellant denies itself liable to be charged interest u/s 234 of the Act from the facts and circumstances of the case. 12. The appellant craves leave to add, alter, amend, substitute, change and dele any of the grounds of appeal. 13. For the ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Ltd Vs. DCIT, reported in 366 ITR 408 (Kar.). The CIT(A), however, rejected the appeal of the assessee. The CIT(A) noticed the judicial pronouncements for and against the assessee and held that the amendment to section 36(1)(va) and 43B of the I.T.Act by Finance Act, 2021 is clarificatory and has got retrospective operation. 5. Aggrieved, assessee has filed this appeal before the Tribunal. The learned AR submitted that an identical issue was decided in favour of the assessee by the Tribunal in the case of M/s. Shakuntala Agarbathi Company Vs. DICT in ITA No.385/Bang/2021 (order dated 21.10.2021). 6. The learned Departmental Representative supported the orders of the Income Tax Authorities. 7. We have heard the rival submissions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 66 ITR 170 (Guj.). The Hon'ble High Court was considering following substantial question of law:- Whether in law, the Tribunal was justified in affirming the finding of Assessing Officer in denying the appellant's claim of deductions of the employees contribution to PF/ESI alleging that the payment was not made by the appellant in accordance with the provisions u/s 36[1][va] of the I.T.Act? 7.1 In deciding the above substantial question of law, the Hon'ble High Court rendered the following findings:- 20. Paragraph-38 of the PF Scheme provides for Mode of payment of contributions. As provided in sub para (1), the employer shall, before paying the member, his wages, deduct his contribution from his wages and depo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arificatory and declaratory in nature. The Hon'ble Supreme Court in the recent judgment in the case of M.M.Aqua Technologies Limited v. CIT reported in (2021) 436 ITR 582 (SC) had held that retrospective provision in a taxing Act which is for the removal of doubts cannot be presumed to be retrospective, if it alters or changes the law as it earlier stood (page 597). In this case, in view of the judgment of the Hon'ble jurisdictional High Court in the case of Essae Teraoka (P.) Ltd. v. DCIT (supra) the assessee would have been entitled to deduction of employees' contribution to ESI, if the payment was made prior to due date of filing of the return of income u/s 139(1) of the I.T.Act. Therefore, the amendment brought about by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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