TaxTMI 
TaxTMI 
2017 (3) TMI 1914
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....acts and circumstances of the case, the ld. CIT(A) is not justified in deleting the disallowance of gratuity liability of Rs.2,54,03,464/- without considering the fact that the assessee was following mercantile system of accounting and that there was no accrual of such liability during the year under consideration. 2. That, on the facts and circumstances of the case, the ld. CIT(A) is not justified in deleting the disallowance of Employees' contribution to the "Labour Welfare Board" and PF of Rs.15,951/- and 32,62,654/- respectively, without considering the fact that provisions of Section 43B of the I.T Act, 1961 is not related to the Employees' contribution to PF. The Hon'ble ITAT 'A 'Bench, Mumbai has decided this issue in favour of th....
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....see's own case for A.Y 2004-05 and relevant portion is reproduced herein below:- 8. This leaves us to decide on the reasons enumerated by the ld. CIT(A) confirming the addition on the basis of reliance on section 36(i)(v), 40A(7)(a), 43B(b) of the I.T Act 1961 and rule 103 and 104 of the I.T Rules. The Ld. CIT(A) has not accepted the contention of the assessee and has distinguished the judgement of the Hon'ble Supreme Court in the case of Kedarnath Jute on the ground that after introduction of section 43B the judgement in Kedarnath's was not relevant. But it appears to us that the Ld. CIT(A) has erred in relying on 36(1)(v), section 40A(7) and section 43B(b) or rule 103 and 104 of the Income tax Act 1961. For convenience section 36(1)(v),....
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....oyees on the retirement shall not be liable which means that the provision made for preretirement of the employees in future shall not be liable and the same also therefore do not debar the allowability of accrued liability for the employees who actually retired during the year. In fact such liability accrued during the year is taken care of in section 40A(7)(b) and the operation of section 40A(7)(a) is subject to section 40A(7)(b) which is as under:- (b) Nothing in clause (a) shall apply in relation to any provision made by the assessee for the purpose of payment of a sum by way of any contribution towards an approved gratuity fund, or for the purpose of payment of any gratuity, that has become payable during the previous year. 9.1 I....
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....1/- and Rs.32,62,654/- respectively. 9. On perusal the tax audit report u/s. 44AB of the Act as filed by the assessee before the AO, during the assessment proceedings he found that the assessee has not deposited the Employees Contribution towards Labour Welfare Board of Rs.15,951/- and Provident Fund of Rs.32,62,654/- as per P.F Act within due date. Thus, the AO disallowed the amount of Rs.15,951/- and Rs.32,62,654/- as per provisions of section 36(1)(va) r.w.s 2(24)(x) of the Act and added the same to the total income of assessee. 10. The CIT-A deleted the impugned addition by relying on the decision of the Hon'ble Calcutta High Court in the case of CIT Vs. Vijayshree Ltd reported in . Relevant portion of the CIT-A order is reproduced he....
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....e denied as long as the same is made within the grace period allowed under the respective statute. Section 38 of EPF Scheme 1952 requires the payment to be made within 15 days of the month & various Circular issued by CPFC & in particulars dated 04.03.1964 & 24.10.1973 provide for grace period which is 5 days. Moreover, after deletion of words during the previous year on or before the due date by Finance Act, 2003, all payments made during the year should be allowed as deduction." It has therefore been claimed that these expenses were allowable and the A.O as not justified in disallowing the same. 6.2 The submissions of the Appellant and the evidences submitted in support of the same have been considered. In view of the same, it is se....