2022 (3) TMI 468

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....019- 20 which is arising out of the assessment order framed u/s 143(1) of the Income Tax Act, 1961 (in short the "Act") dated 12.01.2020 by ADIT, CPC, Bengaluru. 2. The assessee is in appeal before the Tribunal raising the following grounds: "1. FOR THAT on a proper interpretation of the scope and ambit of the provisions of s. 43B of the Income Tax Act, 1961, the Ld. Commissioner of Income Tax (Appeals)-NFAC erred in upholding the action of the Ld. Deputy Commissioner of Income Tax, C.P.C. in resorting to the impugned disallowance of Rs. 30,72,623/- in the instant case and the purported finding on that behalf is absolutely arbitrary, unreasonable and perverse. 2. FOR THAT the Ld. Commissioner of Income Tax (Appeals)-NFAC acted unlawfu....

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.... contribution towards PF&ESI was deposited before the due date of filing the return of income u/s 139(1) of the Act and under the given facts and circumstances of the case, the assessee deserves a relief in view of the decision of the Hon'ble Tribunal, Kolkata Benches in the case of Harendra Nath Biswas vs. DCIT, Circle-29, Kolkata in ITA No. 186/Kol/2021, order dated 16.07.2021. 4. Per contra, ld. D/R vehemently argued supporting the order of both the lower authorities. 5. We have heard the rival contentions, perused the records and carefully gone through the documents filed before us. Disallowance of Rs. 30,72,623/- towards employees' contribution towards PF&ESI is in challenge before us by the assessee. We find that the assessee is req....

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....he very same issue holding that Explanation-2 introduced by the Finance Act, 2021 in Section 36(1)(va) of the Act is prospective in nature and therefore, in view of the settled judicial precedence including the judgment of Hon'ble jurisdictional High Court in the case of Commissioner of Income-tax, Circle -I, Kolkata vs. Vijay Shree Ltd. reported in [2014] 43 taxmann.com 396 (Calcutta) disallowance should not be made of the said amount if it has been deposited before the due date of filing the return of income u/s 139(1) of the Act. Relevant finding of this Tribunal in the case of Harendra Nath Biswas (supra) is reproduced below: "2. The sole grounds of appeal raised by the assessee is against the Ld. CTT(A) in confirming the action of AO....

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....e Act, 2021 to deny the claim of assessee. Therefore, the assessee is before us by preferring this appeal. 4. We have heard both the parties and perused the record. First of all we do not countenance this action of the Ld. C1T(A) for the simple reason that the Explanation 5 was inserted by the Finance Act, 2021, with effect from 01.04.2021 and relevant assessment year before us is AY 2019-20. Therefore the law laid down by the Jurisdictional Hon'ble High Court will apply and since this Explanation-5 has not been made retrospectively. So we are inclined to follow the same and we reproduce the order of Hon'ble Calcutta High Court in the case of Vijayshree Ltd. supra wherein the Hon'ble Calcutta High Court has taken note of the Hon'ble Supr....

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....effect from 1st April, 1988. Such being the position, the deletion of the amount paid by the Employees' Contribution beyond due date was deductible by invoking the aforesaid amended provisions of Section 43(B) of the Act. We, therefore, find that no substantial question of law is involved in this appeal and consequently, we dismiss this appeal. Urgent xerox certified copy of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities." In the light of the aforesaid discussion we do not accept the Ld. CIT(A)'s stand denying the claim of assessee since assessee delayed the employees contribution of EPF & ESI fund and as per the binding decision of the Hon'ble High Court in Vijays....