TaxTMI 
TaxTMI 
2011 (3) TMI 1643
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....one appeared on behalf of the assessee, despite service of not ice on 28.2.2011[AD on record] . Considering the nature of issues involved and the f indings of the learned CIT(A), we proceeded to dispose of the appeal af ter hearing the learned Departmental Representat ive. 3. Advert ing f i rst to ground no.1, facts, in brief , as per relevant orders are that e-return declaring ni l income f iled on 22-12-2006 by the assessee, manufacturing glazed t iles, was selected for scrut iny with the service of a not ice u/s 143(2) of the Income-tax Act , 1961 [hereinaf ter referred to as the "Act "] on 8-10-2007.Dur ing the course of assessment proceedings, the Assessing Of f icer[AO in shor t ] not iced that the assessee ref lected gross prof it [GP] @ 18.98% on sales of Rs. 8,65,13,683/- as against GP @ 29.25% on sales of Rs. 5,34,58,805/ - in the preceding year. To a query by the AO, the assessee submi t ted comparat ive details of increase / decrease in sales and other expenses. I t was pointed out that major increase was on account of expenses on raw material, elect ricity, power & fuel as also inward transportat ion. Since dif ference in increase in expenses was about 10.05%, GP de....
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....e appellant before making estimate of G.P. There are court decisions saying that only for fall in G.P., the books of accounts can not be rejected. The A.O. has not found any defects in the books of accounts of the appellant and simply for fall in G.P., the A.O. has made G.P. addition without considering the reply filed by the appellant which is found to be not proper. The appellant has explained the reasons for fall in G.P., as to be due to increase in fuel rate, raw materials and transport cost. In view of the above facts, the G.P. addition made By the A.O. can not be sustained and the same is deleted." 5. The Revenue is now in appeal before us against the aforesaid f indings of the learned CIT(A). The learned DR while car rying us through the impugned order supported the f indings of the AO. To a query by the Bench, the learned DR did not point out any defects not iced by the AO in the books of accounts. 6. We have heard learned DR and gone through the facts of the case. Indisputably, the assessee is maintaining the books of accounts and no defects have been pointed out by the AO in the purchases or sales and even in the expenses. There is no finding or opinion either that ....
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....al lowance of Rs. 1,26,279/- [actually stated to be Rs. 1,31,162/-] on account of belated deposit of employees' contr ibut ion towards P.F. The AO disal lowed an amount of Rs. 1,26,279/- on account of belated deposit of employees'contr ibut ion towards provident fund by invoking the provisions of sect ion 36(1) (v) of the Act . 8. On appeal, the learned CIT(A) deleted the disal lowance, the amount having been paid by 21-04-2006 i.e. before the due date of f iling of the return. 9 The Revenue is now in appeal before us against the aforesaid f indings of the learned CIT(A). The learned DR supported the f indings of the AO. 10. We have heard the learned DR and gone through the facts of the case .As regards employer's and employees' contribution towards PF , we find that the ITAT Ahmedabad Benches have been consistently following the decision of the Hon'ble Delhi High Court in the case of CIT v. P.M.Electronics Ltd., 220 CTR 635 (Delhi), wherein relying upon the decision of Hon'ble Apex Court in the case of CIT Vs. Vinay Cement Ltd.,213 CTR (SC) 268 , the Hon'ble Court concurred with the view taken by the Hon'ble Madras High Court in Nexus Computer (P) Ltd.,219 CTR(Mad) 54 in ....
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....the assessee shall be entitled to a deduction. The second Proviso to s. 43B (b) provided that any sum paid by the assessee as an employer by way of contribution to any provident fund shall be allowed as a deduction only if paid on or before the due date specified in 36(1)(va) of the Act. After the omission of the second Proviso w.e.f 1.4.2004, the deduction is allowable under the first Proviso if the payment is made on or before the due date for furnishing the return of income. The Hon'ble High Court while considering whether the benefit of s. 43B can be extended to employees' contribution as well, which are paid after the due date under the PF law but before the due date for filing the return, held that (i) Though the Revenue has argued that a distinction is to be made between "employers' contribution" and "employees' contribution" and that employees' contribution being in the nature of trust money in the hands of the assessee cannot be allowed as a deduction if not paid on or before the due date specified in the PF etc law, the scheme of the Act is that employees' contribution is treated as income u/s 2 (24) (x) on receipt by the assessee and allowed as a deduction u/s 36 (1) ....