Income Tax Appellate Tribunal - Chandigarh
Pcp International Ltd., Chandigarh vs Acit, Circle 1(1), Chandigarh on 11 March, 2022
आयकर अपील य अ धकरण,च डीगढ़ यायपीठ "बी", च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL,
CHANDIGARH BENCH 'B', CHANDIGARH
BEFORE SMT.DIVA SINGH, JUDICIAL MEMBER
AND SHRI VIKRAM SINGH YADAV, ACCOUNTANT MEMBER
ITA No. 411/Chd/2021
(Assessment Year: 2018-19)
PCP International Ltd., बनाम ADIT (CPC),
SCO 66, Sector 34A, Bengaluru.
Chandigarh.
थायी लेखा सं./PAN NO: AAACP9910B
नधा रती क ओर से/Assessee by: Shri Neeraj Jain, CA
राज व क ओर से/ Revenue by : Dr.Ranjeet Kaur, Sr.DR
सन
ु वाई क तार ख/Date of Hearing: 08.03.2022
उदघोषणा क तार ख/Date of Pronouncement: 11/03/2022
आदे श/ORDER
Per Diva Singh, Judicial Member:
This is an appeal filed by the assessee against the order of Learned Commissioner of Income Tax ( Ap p e a l s) , N a ti on a l Fa c e le ss Ap pe a l C e n tre ( N F AC ) , D e l h i [ i n sh or t th e 'Ld . C I T( A) '] passed u/s 250 of the Income Tax Act, 1961 (in short 'the Act') dated 09.12.2021 for assessment year 2018-19 on the following grounds:
"1. THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF RS. 1,39,11,3277- ON ACCOUNT OF LATE DEPOSIT OF ESI/PF BUT DEPOSITED BEFORE DUE DATE OF FILING OF RETURN OF INCOME.2 ITA No.411/Chd/2021
A.Y.2018-19
2. THAT WITHOUT PREJUDICE TO THE ABOVE GROUND OF APPEAL THE APPELLANT DISPUTES THE QUANTUM OF DISALLOWANCE.
3. TH A T TH E AP P ELLA N T CR A VE S LEA VE TO A D D , A M M EN D O R MO D IFY TH E GROUNDS OF APPEAL BEFORE DISPOSAL OF APPEAL."
2. The r e le v ant fa c ts r e l a ta bl e to the is sue a re th a t di sa l l ow a nc e wa s ma d e b y the C e ntr a l P r oce ss ing C e n tre (C P C ) , B e n ga l ur u i n the r e t ur n p roce s se d u/s 1 4 3 ( 1 ) f or l a te pa y me n t of ES I / P F e tc . a s p e r s p e ci fi c A ct. The a sse ssee ca r r ie d the is su e in a ppe a l be fore the F ir st Ap p e l l ate Aut hor i ty u ns ucc e s sfu l ly . The N a ti ona l F a ce les s A pp e a l C e n tre c on fi r med t he or de r re je cti n g t he p r a ye r of the a sse sse e . The a s se ssee h a d p le a de d th a t th e p a yme n ts were ma de w e l l i n ti m e be f ore t he f il i ng of r e tur n u /s 1 3 9 ( 1) of the A ct a n d t hu s w it hi n th e d ue da t e . Th e p r e ce de nt re lied up on w a s not a c c e p te d . Ag gr ie ve d b y t hi s, th e a sse sse e is i n a pp e a l be fo re t he I TA T.
3. D ur i ng th e co urse of he a r in g, the Ld . A R s ub m i tte d tha t t he a s se sse e h a s de p osi te d e mpl oye e s ' con tr ib u ti on tow a r ds ES I a n d P F th oug h w i th t he de la y of f e w d a ys fr om the d ue da te me nti on e d i n the res pe cti ve St a tute s, h ow e ve r , the sa me w a s dep osi te d we ll be f or e the d ue d a te o f f il i ng of re tur n of in come u/s 1 3 9 ( 1) of th e Ac t. I t w a s s ub mi tte d tha t th e sa i d fa ct is n ot u nde r d is p ute a n d whe re s uc h con tr ib u tio n ha s b ee n de p osi te d be fore the due d a te of fi lin g of the re t ur n of inc ome , n o d i sa l low a n ce u/s 3 6 (1 ) ( va ) of the Act ca n be ma de . In su pp or t, r e li a nce wa s p l a ce d on 3 ITA No.411/Chd/2021 A.Y.2018-19 de ci si on of the H on 'bl e P un ja b & H a r ya n a H i gh C our t in th e ca se of CI T V s. H e ml a Emb r oi d e r y Mi ll s ( P) Lt d. , 36 6 I TR 11 7 a n d t he de cis ion o f the H on 'b le S up re me C ou r t i n th e ca se of C I T Vs. Al om E xtr us io n Ltd . , 31 9 I TR 3 06 . I t w a s fu rt he r s ub mit ted th a t th e a for e sa i d d e ci si ons ha v e si nce be e n fol l owe d by the Ho n'b le P unj a b & H a r ya na H i gh C our t in th e ca se o f CI T V s. Ma r k A ut o I n d ust r ie s Lt d. , 3 5 8 I TR 43 , C I T V s. Ka m a l Fa mi l y Tr us t ( 2 0 1 3 ), 2 1 9 Ta x ma n 8 1 a n d C I T Vs. N uc he m Li mite d , 5 9 Ta x ma n n. co m 4 5 5. It w as sub mi tte d th a t the Ld . C I T( A) ha s r e l ie d up on th e a me nd me nt b r oug ht i n b y t he Fi na n ce A ct, 2 021 w he re i n Exp la n a ti on -5 h a s b ee n i nse r te d. I t w a s s ub mi tte d th a t the sa i d a me nd me nt h a s b e e n in se rte d w .e .f . a sse ssme nt ye ar 20 2 1 -2 2 onw a r d s a n d ha ve t o b e r e a d p r os pe cti ve ly a nd n ot re tr ospe c ti ve l y and v a ri ou s B e nc he s of the Tr i bu na l h a s be e n ta k i ng a c ons is te n t v ie w in t hi s re ga r d and our re fe re nce w a s d r a w n to t he d e ci si on of th e C ha n d i gar h B e n che s of th e Tr i b un a l in t he ca s e o f M /s C za r s F auce ts Li mi te d V s. C PC in I TA N o. 25 5 /C hd /2 0 2 1 da t e d 0 2. 1 1 .2 0 21 wh e re in t he re le va nt f in d in gs r e a d a s un d e r :
"4. We have heard the submissions and perused th e m a te r i a l a v a i l a b l e o n r e c o r d . It i s s e e n th a t i n t h e p r e s e n t a p p e a l , th e a s s e s s e e h a s o n l y a s s a i l e d t h e d i s a l l o wa n c e s u s t a i n e d b y t h e C IT ( A ) vide his order passed u/s 250(6) of the Act a m o u n t i n g to R s . 4 , 5 2 , 2 3 1 / - o n th e g r o u n d s th a t th e E S I & P F p a y m e n ts we r e n o t m a d e wi th i n t i m e 4 ITA No.411/Chd/2021 A.Y.2018-19 a s p e r th e r e l e v a n t S t a t u t e . T h e c l a i m o f th e a s s e s s e e t h a t t h e p a y m e n ts we r e m a d e b e f o r e th e d u e d a te o f f i l i n g of th e r e t u r n u / s 1 3 9 ( 1 ) wa s h e l d to b e n o t r e l e v a n t . I t i s s e e n t h a t th e s a i d issue as f ar as the presen t Forum is concerned, s t a n d s f u l l y c o v e r e d i n f a v o u r of th e a s s e s s e e n o t o n l y b y t h e c o n s i s t e n t o r d e r s o f th e v a r i o u s B e n c h e s o f t h e IT A T n a m e l y ; t h e o r d e r d a te d 0 3 . 0 8 . 2 0 2 1 of t h e D e l h i B e n c h e s i n th e c a s e o f I n s t a E x h i b i t i o n P v t. L t d . V s A C IT i n IT A 6 9 4 1 / D e l / 2 0 1 7 ; o r d e r d a te d 0 1 . 0 7 . 2 0 2 1 of th e H y d e r a b a d B e n c h i n th e c a s e of Crescent R o a d wa y s Pvt. L td . Vs DCIT in IT A No. 1 9 5 2 / H y d / 2 0 1 8 b u t a l s o c o n s i s t e n t o r d e r s o f th e C h a n d i g a r h B e n c h . I t i s s e e n t h a t a l l a l o n g th e C o - o r d i n a te Benches have held th a t th e a m e n d m e n t s to S e c ti o n s 3 6 ( 1 ) ( v a ) a n d u / s 4 3 B o f th e In c o m e T a x A c t e f f e c te d b y t h e F i n a n c e A c t , 2021 is applicable prospectively and not retrospectively. While coming to the said conclusion, the Benches have relied upon and r e a d f r o m t h e N o te s o n C l a u s e s a t th e t i m e o f i n t r o d u c t i o n of th e F i n a n c e A c t, 2 0 2 1 a n d h a v e held that the amendment is applicable in relation to th e a s s e s s m e n t y e a r 2 0 2 1 - 2 2 a n d s u b s e q u e n t years and not retrospec tively. Thus, in vie w of th i s l e g a l p o s i t i o n a s c o n s i d e r e d b y th e C o - o r d i n a te B e n c h e s a n d t a k i n g n o te of th e d e c i s i o n s of th e j u r i s d i c t i o n a l H i g h C o u r t i n th e c a s e o f C IT V s N u c h e m L i m i t e d IT A 3 2 3 of 2 0 0 9 a n d C IT V s H e m l a E m b r o i d e r y M i l l s P v t . L td . ( 2 0 1 4 ) 3 6 6 IT R 1 6 7 we a r e o f th e v i e w t h a t t h e a d d i t i o n s c a n n o t b e m a d e o r s u s t a i n e d o n t h e s tr e n g th o f th e a m e n d m e n t e f f ec t e d b y F i n a n c e A c t, 2 0 2 1 t o Sections 36(1)(va)/43B of the Act as the legal p o s i t i o n th e r e o n i s v e r y c l e a r . T h e d e p a r t m e n t a l s t a n d th a t i t i s c l a r i f i c a to r y i n n a tu r e h a s c o n s i s t e n tl y b e e n r e j e c t e d . T h u s , i n th e f a c e of th e c l e a r l e g a l p o s i t i o n , a s s e t o u t h e r e i n a b o v e , we f i n d th a t t h e c l a i m o f t h e a s s e s s e e i s t o b e a l l o we d i n t h e y e a r u n d e r c o n s i d e r a ti o n wh i c h i s 2018-19 assessment year. The impugned order, a c c o r d i n g l y , i s s e t a s i d e a n d t h e A O i s d i r e c te d to d e l e te t h e d i s a l l o wa n c e . T h e a p p e a l o f th e a s s e s s e e i s a l l o we d . S a i d o r d e r wa s p r o n o u n c e d i n th e p r e s e n c e o f th e p a r t i e s v i a W e b e x . "5 ITA No.411/Chd/2021
A.Y.2018-19
4. On t he o the r ha n d , th e Ld . DR re lie d u po n th e a me nd me nt b r oug ht i n b y t he Fi na n ce A ct, 2 021 w he re i n Exp la n a ti on to s e ct ion 36 ( 1 )(va ) of th e Ac t ha s b ee n in tr od uc e d . It w a s su b mitt e d th a t f r om th e r e a di n g of th e sa i d a me n dme nt i t i s e vi de n t th a t t he la w is a n d has a l w a ys be e n ve r y c le a r th a t e mp loy ee s ' c on tr ib ut ion t o s pe ci fie d fu nd w i ll not be a ll ow e d a s de du cti on u/s 3 6 ( 1) ( va ) of th e Act i f t he r e i s d e l a y i n d e p os it e ve n b y a s i ngl e d a y a s p e r the du e d a te s spe ci fie d i n t he re spe c ti ve S ta tu te s . I t w a s fu rt he r su b mitt e d t ha t the sa i d a me nd me nt is onl y de cl a r a tor y/cl a r i fi ca to ry in na t u r e and, is , t he re fore , a pp l ic a b le w i th re tr ospe cti ve e f fe ct b y n e ce ssa ry i nte nd me n t of d e e mi ng na t u r e e x pre ssl y s ta te d the re i n. The Ld . D R a ccor d i ng ly s ub mi tte d th a t in vi e w of the u na mb i guo us wo rd i ng of th e n ow a me n d me nt pr ov is io ns of s e cti on s 36 ( 1 )( va ) and 43B, it is c le a r th a t th e emp l oye e s' con tr ib u tio n c a n b e a ll owe d a s a d e d u cti on onl y i f i t ha d be e n pa i d w it hi n t he p r e s cr i bed d ue d a te s u nd e r the re le va n t S ta tu te s a n d th is p osi ti o n ha s b e e n c la r i fie d by the a for e s a i d a me ndme n t. I t w a s a ccor d i ng ly sub m i tte d th a t the re i s n o i n fi r mit y i n the or d er p a ss e d b y the Ld .C I T(A ) wh e re in he h a s s us ta in e d the di sa ll ow a nc e ma d e u/s 1 43 ( 1 ) of the A ct, b y the C P C o n a ccoun t of a s se s se e 's fa i l ur e to pa y t he e mpl oy ee s ' con tr ib u tio n tow a r d s ES I a n d P F wi th in 6 ITA No.411/Chd/2021 A.Y.2018-19 the p re sc ri be d d u e d a te s a s p e r se cti on 3 6( 1 )( v a ) o f t he Act . He a c cor d in gl y su pp or te d the or de r o f the l owe r aut hor i ti e s.
5. W e h a ve h e a r d th e ri va l c on te n tions a n d p e r us e d the ma te r i a l a va i la b l e on re co rd . I n the i ns ta nt ca se , i t i s no t i n di sp u te t ha t e mp lo yee s' c on tr ibu tio n t o ES I a n d P F ha d be e n de p osi te d we l l be fo re the du e d a te of f il i ng of r e tu r n of in come u /s 13 9 ( 1 ) of the Ac t. We f ur the r n ote tha t th oug h the l d . CI T( A) h a s not d is p ute d th e v a r iou s d eci si on s of Hon 'b l e P un j a b & Ha r y a na H i gh C our t b ut h a s de ci de d to fol l ow t he de ci sion r e n de re d b y th e H on'b le G uja r a t H ig h C our t. Gi v e n t he d i ve rge n t vi e w s t a ke n b y th e v a ri ou s H ig h C our ts a n d i n the i ns ta n t c a se , the f a ct tha t the ju r is d ic ti on ove r the As se s sing of f ic e r l ie s w i th the H on 'b le Pu nj a b & Ha r ya n a H i gh C our t , in ou r con si d e re d view , t he I d C I T( A) ou gh t to h a v e c on si de re d an d f oll ow e d the de c is io n of the ju ri s di ct ion al Pu nj a b & Ha r ya na H ig h C ou r t, a s e vi dent fr om s e r ie s of d e c is ion s r e fe rre d sup r a , a s t he sa me i s bi n di n g on a l l t he a p pe l l a te a ut hor i ti e s a s we ll a s the Ass e ss i ng of fi ce r un d e r i ts j uri sd i cti on in th e Stat e of Pu nj a b & H a r ya n a . W e fu rt he r n ote tha t the ld C I T( A) h a s re fe rre d to th e ame nd me n t br ou gh t i n b y t he F in a n ce Ac t, 20 2 1 w h e re i n an e xpl a n a ti on has been i ntro du ce d to Se c ti ons 3 6 (1 ) (v a) a nd u /s 4 3 B of th e I nc ome Ta x Act . It is a co nsi s te n t p os it ion a c r oss va r i ou s B e nc he s of th e Tr i b un a l 7 ITA No.411/Chd/2021 A.Y.2018-19 in cl ud i ng C ha n d iga rh B e n che s tha t t he a me nd me n t w h ic h ha s b ee n b r ou ght i n by the Fi n anc e A ct, 2 0 2 1 sh a l l a p pl y w. e . f. a sse s sme nt ye a r 2 02 1 -2 2 a nd s ub se q ue n t a s se s sme n t ye a r s a n d the imp ugn e d a ss e ssme n t ye a r be i ng a s se s sme n t ye a r 2 0 1 8-1 9 , the sa i d a me n d men t ca n n ot b e a p pl ie d in the in sta n t ca se . The re fore , con si de r ing th e e n tire ty of fa c ts a nd ci rc ums ta nc e s of t he ca se a nd fol l ow i ng th e de ci si on s of va r io us Hi gh C ou r ts a s w e ll a s C oor d i na te Be n che s of the Tr i b un a l re fe rre d a b ove , the add i ti on ma de by way of a dj us tme n t w h il e pr oce s si ng the re tu r n of i ncome u/s 14 3 ( 1) o f t he Act, a moun ti ng to Rs. 1 ,3 9 ,1 1 , 32 7 /- s o ma d e by th e C P C to wa r d s th e de po si t o f e mp lo yee s' con tr ib u ti on tow a r ds ES I a n d P F p a i d b e f ore th e d ue d a te of fil in g of the re tur n of i nc ome u/ s 1 39 ( 1 ) of th e A ct, i s he re by d i re cte d to be de le te d .
6. I n the re s ul t, the a p p e a l of t he a sse s se e i s a l lo we d.
O r d e r p r on o u n ce d o n 1 1 /0 3 / 2 0 2 2 .
Sd/- Sd/-
(VIKRAM SINGH YADAV) (DIVA SINGH)
लेखा सद य/Accountant Member याय क सद य/Judicial Member
Dated: 11/03/2022
*रती*
8 ITA No.411/Chd/2021
A.Y.2018-19
आदे श क % त&ल'प अ*े'षत/ Copy of the order forwarded to :
1. अपीलाथ+/ The Appellant
2. %,यथ+/ The Respondent
3. आयकर आयु-त/ CIT
4. आयकर आयु-त (अपील)/ The CIT(A)
5. 'वभागीय % त न0ध, आयकर अपील य आ0धकरण, च2डीगढ़/ DR, ITAT, CHANDIGARH
6. गाड फाईल/ Guard File आदे शानस ु ार/ By order, सहायक पंजीकार/ Assistant Registrar