TMI Blog2022 (6) TMI 890X X X X Extracts X X X X X X X X Extracts X X X X ..... - SUPREME COURT] by laying down the dictum if two reasonable constructions of a taxing provision are possible that construction which favours the Assessee must be adopted. The issue under controversy travelled upto the Hon ble Apex Court in the cases of Rajasthan State Beverages Ltd [ 2017 (7) TMI 1087 - SC ORDER] , CIT Vs. Alom Extrusion Ltd [ 2009 (11) TMI 27 - SUPREME COURT] , CIT Vs. Vinay Cement Ltd [ 2007 (3) TMI 346 - SC ORDER] clearly held the amount claimed on payment of PF and ESI if deposited on or before due date of filing of returns then the same cannot be disallowed u/s 43B or u/s 36(1)(va) of the Act. Coming to the amendments brought in by the Finance Act 2021 by inserting Explanation 2 in Section 36(1)(va) and 5 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w and on facts in confirming the addition of Rs.2112070/- made by the CPC u/s 43(1) of I.T. Act, on account of late deposit of PF/ESI following the amendment in 43B regarding Employees Contribution of Provident Fund, ESI or any other welfare fund under Finance Act 2021 ignoring the fact that amendment made in section 43B is not with retrospective effects. Addition made u/s 143(1) by CPC is void abinitio therefore it is prayed before your honor the same may kindly be deleted. 2. The Learned Commissioner of Income Tax (Appeals) has erred in law and on facts in confirming the addition made by CPC in disallowing the payment of Employees contribution of ESI/PPF on the ground that the amount was paid after due date by the assessee, wherea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herein Explanations have been inserted by Finance Act, 2021. 5. Admittedly 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. Vegetables Products Ltd. (88 ITR 192) by laying down the dictum if two reasonable constructions of a taxing provision are possible that construction which favours the Assessee must be adopted. 6. The issue under controversy travelled upto the Hon ble Apex Court in the cases of Rajasthan State Beverages Ltd (2017) 84 Taxmann.com 185 (SC), CIT Vs. Alom Extrusion Ltd (2010) 1 SCC 489, CIT Vs. Vinay Cement Ltd 213 CTR 268 and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount paid is allowed as an expenditure only when payment is actually made. We do not think that the legislative intent and objective is to treat belated payment of employee's provident fund (EPD) and employee s State Insurance Scheme (ESI) as deemed income of employer under section 2(24)(x) of the Act. 9. Even the Hon ble Punjab and Haryana High Court in the case of CIT Vs. M/s Hemla Embroidery Mills (P) Ltd. (366 ITR 167) (P H) and in the case of CIT Vs. M/s Mark Auto Industries Ltd. (358 ITR 43) (P H) has clearly held that the Assessee is entitled to claim deduction of employee s share of ESI PF u/s.43B of the Act, if the same has been deposited prior to the filing of return of income u/s.139(1) of the Act. 10. From t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ua applicability of the amendment to Sections 36(1)(va) and Section 43B of the Act, by inserting Explanations by the Finance Act, 2021 and clearly held that the amendment shall be applicable from 1st April, 2021 onwards . It is also relevant to note that the CBDT has also issued Memorandum of Explanation qua applicability of the amended provisions of Sections 36(1)(va) 43B of the Act w.e.f. 1st April, 2021 and Assessment Year 2021-22 onwards, hence there is no doubt qua applicability of the amended provisions referred above, prospectively. 13. On the aforesaid discussion, the second aspect as considered by the ld. CIT(A) qua applicability of the amended provisions of Sections 36(1)(va) and 43B of the Act to the cases in hand, is also u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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