TMI Blog2022 (9) TMI 962X X X X Extracts X X X X X X X X Extracts X X X X ..... HD/2022 are reproduced hereunder: 1. That the ld. CIT(A) has erred in law and on facts in confirming the actions of ld. ADIT, CPC Bangalore in making disallowance of Rs. 1,38,563/- (Rs. 2,80,815/- in ITA 305/CHD/2022) u/s. 36(1)(va). 3. Before referring to the grievance of the assessee, it is necessary to address the delay of 70 days pointed out by the Registry in ITA 305/CHD/2022 and delay of 238 days pointed out by the Registry in ITA 304/CHD/2022. 4. The ld. AR present on behalf of the assessee addressing the delay invited attention to the Condonation of Delay Applications available on record submitted that whereas in ITA 305/CHD/2022 there is an effective delay of only 3 days as the remaining period is covered by the decision of the Apex Court considering the then prevalent COVID conditions. 4.1. In ITA 304/CHD/2022, it was submitted that there is a delay of 22 days after the Covid period is excluded for counting the limitation. 4.2. Referring to the decision of the Apex Court, it was submitted, that the Hon'ble Court directed that the Covid period was to be excluded for limitation purposes. Referring to the record, it was submitted, that if the said perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. 9. This position of fact was noticed to be correct and not disputed by the Sr. DR. She relied upon the impugned order. However, she agreed that the deposits were made well in advance before the filing of the return but in terms of the requirements of the specific Act, there was a delay. 10. I have heard the submissions and perused the material on record. It is seen that the said issue is no longer re-integra as has been held in various orders of the ITAT following the position of law as considered by Hon'ble jurisdictional High Court and various other Courts. Drawing strength from order dated 21.04.2022 in Vardhman Textiles Ltd., Ludhiana Vs DCIT, Ludhiana (ITA 373/CHD/2021), I allow the appeals of the assessee. The relevant extract from the said order is reproduced for completeness: 4. We have heard the rival submissions and perused the material available on record. The said issue has been considered at length by various orders of the ITAT including the Chandigarh Bench in ITA 194/CHD/2021 dated 18.11.2021 in the case of Surya Resorts Pvt. Ltd. Dharamshala, ITA No. 255/CHD/2011 dated 02.11.2021 in the case of CZAR Faucets Limited in ITA No. 255/CHD/2021 order dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect by various orders of the ITAT as on a bare consideration of the Notes on Clauses appended to the Finance Bill it was clarified that the Amendment will take effect from the First April 2021. Thus, the legal position thereon is well settled. The Coordinate Benches have consistently right from order dated 03.08.2021 of the Delhi Benches in Insta Exhibitions Pvt. Ltd. Vs Addl. CIT, New Delhi in ITA No. 6941/Del/2017 and Hyderabad Benches vide order dated 01.07.2021 in M/s. Crescent Roadways Pvt. Ltd. V Dy. CIT, Hyderabad in ITA No. 1952/Hyd./2018 have held that the amendments are prospective and not retrospective in nature. The reasoning has been addressed at length in the order dated 02.11.2021 in the case of Shri Sukhdev Singh, Mohali Vs ITO, Chandigarh in ITA 250/CHD/2021 wherein it was held: 4. We have heard the submissions and perused the material available on record. It is seen that the issue is no longer res-integra as the decision of the jurisdictional High Court amongst others has been followed by the ITAT Chandigarh Benches vide its order dated 01.07.2021 in the case of M/s. Jupiter Aqua Lines Pvt. Ltd. Vs DCIT ITA 83/CHD/2021 and order dated 04.10.2021 in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). The Hon'ble Delhi High Court held that the legislative intent was/is to ensure that the amount paid is allowed as 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 the employer under Section 2(24)(x) of the Act. It is settled law that when two judgments are available giving different views then the judgment which is in favour of the assessee shall apply as held in case of Vegetable Products Ltd. 82 ITR 192 by the Hon'ble Supreme Court. Hence, in light of the latest decision in case of Pro Interactive Service (India) Pvt. Ltd., the issue is covered in favour of the assessee. Hence, Ground No. 1 is dismissed. 7. Further with respect to the argument of the learned departmental representative that amendment made with finance act 2021 wherein explanation 1 is added u/s. 36 (1) (va) of the act with effect from 1 April 2021, is applicable to the present case, we referred to the Notes on clauses at the time of introduction of the finance bill 2021 which says as Under:- Clause 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amendment to section 36(1)(va) and u/s. 43B of the Act effected by the Finance Act 2021 is applicable prospectively, reading from the Notes on Clauses at the time of introduction of the Finance Act, 2021, specifically stating the amendment being applicable in relation to assessment year 2021-22 and subsequent years. Accordingly, considering the factual backdrop of the present case and considering the amendments in Section 36(1)(va) as well as Section 43B carried out by Finance Act, 2021 and Memorandum explaining the provisions in Finance Bill, 2021 we hold that the impugned disallowance is not sustainable and is directed to be deleted. The appeal of the assessee is allowed. Said order was pronounced in the presence of the parties via Webex. (emphasis supplied) 5. Similar view has also been taken in order dated 02.11.2021 in the case of M/s. Czar Faucets Limited Chandigarh Vs DCIT, Bangalore in ITA 255/CHD/2021; in order dated 16.11.2021 in the case of Pooja Sarees, Ambala City in ITA No. 184/CHD/2021 and in order dated 16.11.2021 in the case of M/s. A.K. Creative Outsourcing Services Pvt. Ltd., Baddi in ITA No. 252/CHD/2021. The specific reasoning summing up the legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The appeal of the assessee is allowed. Said order was pronounced in the presence of the parties via Webex. (emphasis supplied) 6. Accordingly, on account of the aforementioned reasoning, we hold that the disallowance of Rs. 5,24,104/- sustained in the present appeal by the CIT(A) qua the employees' contribution despite late payment qua the specific Act cannot be made. Admittedly, in the facts of the present case the payment has been made well within the time line as set out under the Income Tax Act u/s. 139(1) of the Income Tax Act. Thus, admittedly the return of income was filed well within time after making the specific payments. The position of law that the Amendments carried out by the Finance Act, 2021 are prospective in nature and not declaratory stand well settled. The disallowance, accordingly, cannot be sustained. 7. Before parting, it is necessary to refer to the decision of the jurisdictional High Court referred to by the assessee in the specific ground No. 2 raised in the present appeal wherein the decision of the Hon'ble Himachal Pradesh High Court in the case of CIT vs Nipso Polyfabrika Ltd. [2013] 350 ITR 327 has been relied upon. The said d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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