Tribunal allows appeal, disallows CPC disallowance under Section 43B.

The Tribunal allowed both appeals filed by the assessee, directing the deletion of the disallowance made by CPC for both assessment years. It held that contributions deposited before the due date of filing the return cannot be disallowed under section 43B read with section 36(1)(va). The Tribunal emphasized the importance of following the jurisdictional High Court's decisions and noted that the other grounds of appeal became academic and did not require adjudication in light of the decision on the main issue.

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Issues Involved:
1. Delay in filing the appeal.
2. Disallowance under section 36(1)(va) while processing the return under section 143(1).
3. Sustenance of disallowance by CIT(A) despite binding jurisdictional High Court judgment.

Detailed Analysis:

1. Delay in Filing the Appeal:
The assessee faced a 24-day delay in filing the appeal due to the Covid-19 pandemic and lockdown in Rajasthan. The appeal was due on 16/05/2021, but due to the closure of offices and postal services, it was filed late. The Tribunal condoned the delay under section 253(5) of the Act, citing sufficient cause due to the pandemic.

2. Disallowance under Section 36(1)(va) while Processing the Return under Section 143(1):
The assessee challenged the disallowance of employee contributions to welfare funds deposited after the prescribed dates but before the due date for filing the return under section 139(1). The assessee argued that such adjustments are not permissible under section 143(1)(a) as they are debatable and not apparent from the return information. The Tribunal noted that the jurisdictional High Court of Rajasthan has consistently held that contributions deposited before the due date of filing the return are allowable. Hence, the adjustment made by CPC was deemed illegal and unjustified.

3. Sustenance of Disallowance by CIT(A) Despite Binding Jurisdictional High Court Judgment:
The CIT(A) sustained the disallowance based on the Gujarat High Court judgment in the case of State Road Transport Corporation, ignoring the binding judgment of the Rajasthan High Court in CIT vs. SBBJ. The Tribunal emphasized that the CIT(A) should have followed the jurisdictional High Court's decision, which allows deductions for contributions deposited before the due date of filing the return. The Tribunal cited several decisions of the Rajasthan High Court, including CIT vs. State Bank of Bikaner & Jaipur, which support the assessee's position.

Conclusion:
The Tribunal directed the deletion of the disallowance made by CPC for both assessment years, holding that the contributions deposited before the due date of filing the return cannot be disallowed under section 43B read with section 36(1)(va). The Tribunal also noted that, given the decision on merits, the other grounds of appeal regarding the adjustment while processing the return became academic and did not require adjudication.

Result:
Both appeals filed by the assessee were allowed.

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