TaxTMI 
TaxTMI 
2021 (10) TMI 621
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.... NIL Income. The above return was revised on 13.03.2019 after receiving notice under section 143(1)(a) of I.T. Act for the proposed adjustment of Rs. 45,93,409/- comprising of disallowance of late payments made on account of employees' ESI/EPF and payments covered under section 43B of the I.T. Act, 1961. Subsequently, a notice under section 143(1)(a) of I.T. Act was issued on 22.07.2019 for proposed set off of Rs. 8,37,846/- being disallowance of late payments of ESI/EPF with claim of brought forward/carried forward loss claimed in the return. The assessee filed response to the above notice by disagreeing the above proposed adjustment. Thereafter, the CPC Bangalore, processed the revised return of income and intimation dated 15.11.2019 was issued under section 143(1) making the above adjustment of Rs. 8,37,846/- under section 36(1)(va) of the I.T. Act, 1961. The assessee filed rectification request on 16.05.2020 and the rectification processing order dated 04.06.2020 was issued under section 154 of I.T. Act, 1961 wherein the above disallowance Rs. 8,37,846/- on account of late deposit of employees' contribution to ESI/EPF was made and demand of Rs. 2,15,747/- was raised and adjuste....
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.... Delhi in the case of DCIT vs., Dee Development Engineers Ltd., vide ITA.No.4959/Del./2016 dated 08.04.2021. 3. Order of the ITAT, Delhi in the case of DCIT vs., Planman HR (P) Ltd., vide ITA.No.5152/ Del./2017 dated 15.07.2021. 4. Order of the ITAT, Chennai in the case of DCIT vs., Talenpro India HR Pvt. Ltd., vide ITA.No.265/ Chennai/2019 dated 09.04.2021. 5. Order of the ITAT, Agra in the case of Mahadev Cold Storage vs., Jurisdiction Assessing Officer vide I.T.A. Nos. 20 & 21/Agra/2021 dated 14.06.2021. 6. Order of the ITAT, Chennai in the case of DCIT vs., Repco Home Finance Pvt. Ltd., reported in [2020] 183 ITD 782 ITAT-Chennai. 6. The Ld. D.R. on the other hand strongly supported the order of the Ld. CIT(A) and submitted that since the assessee has not made the deposits on account of employees' contribution to PF & ESI before the specified dates as mentioned in the Statute, therefore, the Ld. CIT(A) was fully justified in sustaining the addition made by the CPC. He submitted that there are various decisions in favour of the Revenue where the Hon'ble High Courts have held that the Amendment by Finance Act, 2015 in Section 43B is restricted only in respect of employer....
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....India) Pvt. Ltd., vide ITA.No.983/2018 order dated 10.09.2018 has held that no disallowance is called for where the assessee had paid the employees' contribution to PF & ESI before the due date of furnishing of return of income under section 139(1) of the I.T. Act, 1961. 7.1. I find the Hon'ble Delhi High Court in the case of PCIT vs., Pro Interactive Service (India) Pvt. Ltd., (supra), following the decision in the case of CIT vs., AIMIL Ltd., (supra), has held that legislative intent was/is to ensure that the amount paid is allowed as expenditure only when payment is actually made. It was further held that it was not the legislative intent and objective to treat belated payment of Employees' Provident Fund & Employees' State Insurance Scheme as deemed income of the employer under section 2(24)(x) of the I.T. Act, 1961. 7.2. I find the Coordinate Bench of the Tribunal in the case of Insta Exhibitions Pvt. Ltd., New Delhi vs., Addl. CIT, Special Range-4, New Delhi vide ITA.No.6941/Del./2017 order dated 03.08.2021 while allowing such belated deposit of employees' contribution to PF & ESI as per the respective Act, but, paid before the due date of filing of the income tax return, d....
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....our 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 of the Bill seeks to amend section 36 of the Income tax Act, relating to other deductions. Sub-section (1) of the said section provides for allowing of deductions provided for in the clauses thereof for computing the income referred to in section 28 of the said Act. Clause (va) of the said sub-section provides for allowance of deduction for any sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 apply, if such sum is credited by the assessee to the employ....