2022 (8) TMI 1221

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....d 11-3-2020 passed u/s 263 of the Income-tax Act by the Principal Commissioner of Income-tax is illegal, ab-initio and unsustainable in-law. 2. The Ld. Principal Commissioner of Income Tax has eared in holding that the assessment order dated 22-11-2017 passed by the Assessing Officer u/s 143(3) of Income Tax Act (the Act) is erroneous and prejudicial to the interest of the revenue. 3. The Ld. Principal Commissioner of Income Tax has eared in holding that the Assessing Officer did not examine the issue of allowability of the employee's contribution to provident fund amounting to Rs,19,84,130/- and has allowed without any verification. The Ld. Principal Commissioner -of Income Tax has failed to appreciate that the fact, that the emp....

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....ed as erroneous and prudential to the interest of the revenue. The Ld. Principal Commissioner of Income Tax has therefore eared in holding that the assessment order dated 22- 11-2017 passed by the Assessing Officer u/s 143(3) of Income Tax Act (the Act) is erroneous and prejudicial to the interest of the revenue. 5. The Ld. Principal Commissioner of Income Tax has eared in holding that the claim of deduction relating employee's contribution to Provident Furid is governed by section 36(1)(vi)(a) and the sum of Rs.19,84,130/- needs to be disallowed u/s 36(1)(vi)(a) r.w.s 2(24)(x) of the Act. and provision of section 43B are not applicable to such deduction. This finding of the Ld. Principal Commissioner of Income Tax is contrary to the....

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....e return of income u/s 139 of the Act. This fact was duly mentioned in para 20 clause (b) of the Tax auditor Report filed with the Return of Income and complete information in this regard was before the A.O. Further, it is contended that Hon‟ble Bombay High Court in the case of M/s. Ghatge Patil Transports Ltd. 53 taxmann.com 141 (Bombay) has held that the employees‟ contribution to provident fund is allowable as deduction u/s 43B of the Act if it is paid to the Government account before the due date of filing of return of income though it might have been paid after the due date prescribed under the Provident Fund Act. 3. We have perused the order of the ld. Pr. CIT u/s 263 of the Act specifically para 3 wherein the payment dat....

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....The Memorandum explaining the provisions of the Finance Bill, 2021, provides that this amendment will take effect from 1st April, 2021 and will, accordingly, apply in relation to assessment year 2021-2022 and subsequent assessment years. Since the assessment year under consideration, namely, 2017- 18 is anterior to the amendment carried out with effect from A.Y. 2021-22, I hold that the position of law as set out by various Hon'ble High Courts including Ghatge Patil Transports Ltd. (supra) squarely applies to the facts and circumstances of the instant case thereby not warranting any disallowance as the amount in question was admittedly deposited before due date u/s 139(1) of the Act. The addition is therefore, directed to be deleted." 4. ....