2022 (2) TMI 116

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....espectively u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act'). 2. The issue involved in the instant appeals relates to the deposit of employees' contributions qua ESI, PF and Labour Welfare Fund after the due date as prescribed in the relevant Acts, however, before the due date of filing of return of income u/s.139(1) of the Act, resulting into following disallowances by the Assessing Officer. AY ESI Contribution PF Contribution Labour Welfare contributions 2018-19 Rs. 91,85,979/- 8,45,841/- 1,61,700/   AY ESI Contribution PF Contribution Labour Welfare contributions 2019-20 Rs. 30,28,292 3,83,269 1,46,870 3. Against the above disallowances, the Assessee ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....he case of CIT Vs. AIMIL Ltd 321 ITR 508. 5.2 We observe that although the ld. CIT(A) has considered the judgments relied upon by the Assessee as observed in its order at para no. 5.3 to the effect "however the case law quoted by the Appellant and some other Courts have applied the provision of Section 43B on employee contribution as well and held that if such payment(Employees' contribution) is made before the due date of filling of Return of Income, no disallowance should be made u/s 36 of the Act", howeverdeclined the claim of the Assessee while relying upon judgments rendered against the contention raised by the Assessee, by Hon'ble High Courts in the case ofGujrat State Road Transport Corporation Ltd. {Tax Appeal no. 637 of 2013 rep....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... as well, in the case of CIT Vs. AIMIL Ltd (supra) affirmed the action of the ITAT in deleting the addition relating to employees' contribution deposited before the due date of filing of return, in respect of Provident Fund and ESI made by the Assessing Officer under Section 36(1)(va) of the Income Tax Act, 1961. Again Jurisdictional High Court in the case of PCIT vs., Pro Interactive Service (India) Pvt. Ltd., vide ITA.No.983/2018 order dated 10.09.2018 while following the decision in the case of CIT Versus 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 tre....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ssessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 applies." 5.7 Weobserve that various benches of the ITAT including Hyderabad Bench in the case of Value Momentum Software Services Pvt. Ltd. (ITA No.2197/Hyd/2017 decided on 19.05.2021), have taken into consideration the identical issue qua applicability of the amendment to Sections 36(1)(va) and Section 43B of the Act, by inserting Explanations by the Finance Act, 2021 and clearly held that the amendment shall be applicable from 1st April, 2021 onwards . It is also relevant to note that the CBDT has also issued Memorandum of Explanation qua applicability of the amended provisions of Sections 36(1)(va) & 43B of the Act w.e.f. 1st April....