TMI Blog2022 (8) TMI 1177X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable with retrospective effect unless the legislature specifically says so. The aforesaid amendment is applicable only prospectively i.e., from 1.4.2021. We are therefore of the view that the impugned additions made under section 36(1)(va) of the Act, deserves to be deleted. - Decided in favour of assessee. - ITA No. 309/Bang/2022 - - - Dated:- 1-8-2022 - SHRI N. V. VASUDEVAN, VICE PRESIDENT For the Appellant : Priya Balashankar, CA For the Respondents : Ganesh R. Ghale, Standing Counsel ORDER This is an appeal filed by the assessee against order dated 01.12.2021 of CIT(A), National Faceless Appeal Centre (NFAC), Delhi, relating to Assessment Year 2019-20. 2. In this appeal, the only issue that requires c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning the due date under this clause;'. The finance Act, 2021 also amended section 43B by inserting Explantion-5 thereto which reads thus: Explanation 5.-For the removal of doubts, it is hereby clarified that the provisions of this section shall not apply and shall be deemed never to have been applied to a sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 applies. 5. According to the CIT(A), by virtue of newly inserted Explanation 2 to clause (va) of sub-section (1) of the said section, the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purposes of determining the due date under the said clause. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent footings and have different parameters for due dates, i.e., employee's contribution is linked to payment before the due dates specified in the respective Acts or Funds and employer's contribution is linked to the payment before the prescribed due date for filing of return u/s. 139(1) Income Tax Act, 1961. The result of any failure to pay within the prescribed dates also leads to different results. In the case of employee's contribution, any failure to pay within the prescribed due date under the respective PF Act or Scheme will result in negating employer's claim for deduction permanently forever u/s. 36(1)(va). On the other hand, delay in payment of employer's contribution is visited with deferment of deduction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Year: 2018-19] dated 28.09.2021 9. The Hon'ble Karnataka High Court in the case of Essae Teraoka Pvt. Ltd., (supra) has taken the view that employee's contribution under section 36(1)(va) of the Act would also be covered under section 43B of the Act and therefore if the share of the employee's share of contribution is made on or before due date for furnishing the return of income under section 139(1) of the Act, then the assessee would be entitled to claim deduction. Therefore, the issue is covered by the decision of the Hon'ble Karnataka High Court. In this case there is no dispute that the assessee made payment of the Employees share of PF/ESI on or before the due date for filing return of income for AY 2017-18 u/s. 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n before a Court is as to whether law has to be regarded as retrospective and those four factors are (i) general scope and purview of the statute; (ii) the remedy sought to be applied; (iii) the former state of the law; and (iv) what it was the legislature contemplated. According to him, if the above guidelines are applied, the amendment to Sec. 36(1)(va) of the Act by the Finance Act, 2021 has to be regarded as retrospective. I am unable to accept the submission firstly for the reason that the legislature did not choose to make the amendment retrospective. Secondly, the amendment seeks to fasten a liability on the Assessee and the amendment does not seek to remove any hardship faced by an Assessee. Therefore the amendment has to be regarde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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