2006 (6) TMI 71 - HC - Income Tax

Employer provident fund contributions paid after accounting period but before return filing eligible for deduction under Section 43B(b)

Commissioner of Income-Tax Versus George Williamson (Assam) Limited.

GAUHATI HC held that employer contributions to provident fund and similar funds paid after the accounting period but before the due date for filing the ... Interpretation of clause (b) of section 43B of the Income-tax Act, 1961, read with the second proviso to the said section and clause (va) of sub-section (1) of section 36 - after the accounting period but before the due date for filling the return of income - deposit of contributions made towards provident fund, etc. - entitlement to relief under section 43B(b) - HELD THAT:- Learned counsel for both sides have submitted that the question raised in these appeals stands covered by the decision of this court in the case of CIT v. Assam Tribune [2001 (2) TMI 36 - GAUHATI HIGH COURT], wherein it was held that the contributions towards provident fund, etc., paid before the filing of the return by the assessees are entitled for the deduction. We also find that the above decision rendered by this court was based on an earlier decision of this court in the case of CIT v. Bharat Bamboo and Timber Suppliers [1996 (1) TMI 104 - GAUHATI HIGH COURT]. On consideration of the submissions and on perusal of the earlier decisions of this court we are not inclined to review the decisions in Bharat Bamboo and Assam Tribune and accordingly we hold that the decision of the above cases shall apply to the present appeals. The appeals, therefore stand dismissed as aforesaid. Issues: Interpretation of section 43B of the Income-tax Act, 1961 regarding deposit of contributions made towards provident fund after the accounting period but before the due date for filling the return of income.In this judgment by the High Court, the court addressed the interpretation of clause (b) of section 43B of the Income-tax Act, 1961, along with the second proviso to the said section and clause (va) of sub-section (1) of section 36 of the Act. The central issue revolved around whether assessees are entitled to relief under section 43B(b) for depositing contributions towards provident fund after the close of the accounting period but before the due date for filing the return of income. The court noted that a previous decision in the case of CIT v. Assam Tribune had held that such contributions made before the filing of the return are eligible for deduction, based on an earlier decision in the case of CIT v. Bharat Bamboo and Timber Suppliers. The appellants sought a review of this decision, citing a contradictory judgment from the Kerala High Court in the case of CIT v. South India Corporation Ltd. However, the respondents argued that the relevant proviso to section 43B(b) had been amended, leading to the omission of certain words, which, according to them, implied that the provisions were no longer in existence. They relied on various decisions, including those of the Constitution Bench of the apex court, to support their argument.After considering the submissions and reviewing the earlier decisions of the court, the High Court declined to review the decisions in Bharat Bamboo and Assam Tribune. Consequently, the court held that the decisions in those cases would apply to the present appeals. As a result, the appeals were dismissed based on the aforementioned findings and interpretations of the relevant provisions of the Income-tax Act, 1961.