TMI Blog2022 (5) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act is not clarificatory. 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. - Decided in favour of assessee. - ITA Nos. 3 & 4/Bang/2022 - - - Dated:- 7-4-2022 - SHRI B. R. BASKARAN , ACCOUNTANT MEMBER For the Appellant : Sachin H. S. , A. R. For the Respondents : Ganesh R. Ghale , Standing Counsel ORDER Per B. R. Baskaran , Accountant Member The assessee has filed these appeals challenging the orders passed by Ld. CIT(A), National Faceless Appeal Centre, Delhi and they relate to the assessment years 2018-19 and 2019-20. The only issue urged in these appeals relate to disallowance of Rs. 21,68,554/- and Rs. 13,19,485/- being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remitted the employees contribution of PF ESI before the due date prescribed u/s. 139(1) of the Act, even though the contributions were paid in few instances beyond the due date prescribed in the respective Statutes. 5. The question whether the payments made beyond the due date prescribed under respective statutes, but before the due date prescribed u/s. 139(1) of the Income tax Act was considered and 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). The learned Departmental Representative supported the orders of the Income Tax Authorities. 6. I heard both parties and perused the record. On identical facts, the Bangalore Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h 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 deposit the same together with his own co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure. 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 EssaeTeraoka (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 the Finance Act, 2021 to section 36 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year under consideration. By following the binding decision of the Hon'ble jurisdictional High Court in the case of EssaeTeraoka Pvt. Ltd. Vs. DCIT (supra), the 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, I decide this issue in favour of the assessee and the disallowance made by the Assessing Officer is deleted. 8. The Ld. A.R. also raised a legal issue contending that the impugned addition would not fall under the category of adjustments that could be made while processing the return of income u/s. 143(1) of the Act. Since, I have decided the issue on merit in favour of the assessee, there is no necessity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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