2018 (2) TMI 1458 - AT - Income Tax

Disallowance u/s 43B - payment of employees contribution to Provident Fund and ESIC - Held that - The issue in appeal is squarely covered by the decision of the Hon ble Jurisdictional High Court Ghatge Patil Transport Ltd. 2014 (10) TMI 402 - BOMBAY HIGH COURT wherein held both employees and employer s contributions are covered under the amendment to Section 43B of I.T. Act - the Tribunal was right in holding that payments are subject to benefits of Section 43B Decided against revenue. Allowing set off of brought forward depreciation for A.Y. 2001-02 beyond eight assessment years - Held that - On perusal of the order of the Coordinate Bench in assessee s own case we find that similar issue had come up before the Tribunal in A.Y. 2009-10 and the Coordinate Bench has decided this issue in favour of the assessee allowed setting off of depreciation. Decided against revenue.

Summary

Issues:
1. Disallowance of PF and ESIC contributions under Section 43B of the Income Tax Act, 1961.
2. Allowing set off of brought forward depreciation for A.Y. 2001-02 beyond eight assessment years.

Issue 1: Disallowance of PF and ESIC contributions under Section 43B
The Revenue filed an appeal against the CIT(A)'s order for A.Y. 2011-12, challenging the deletion of disallowance under Section 43B for PF and ESIC contributions. The AO disallowed these contributions as they were remitted beyond due dates specified in the Acts. However, the CIT(A) deleted the disallowance citing the decision of the Jurisdictional High Court in CIT vs. Ghatge Patil Transport Ltd. The Tribunal upheld the CIT(A)'s decision, emphasizing the distinction between employees' and employer's contributions, following the High Court's ruling. The Tribunal dismissed the Revenue's ground, relying on the precedent.

Issue 2: Allowing set off of brought forward depreciation beyond eight years
The Revenue raised a ground against allowing set off of brought forward depreciation for A.Y. 2001-02 beyond eight assessment years. The assessee cited the decision of the Gujarat High Court in General Motors Pvt. Ltd. to support their case. The Tribunal noted a similar issue in the assessee's case for A.Y. 2009-10, where the Coordinate Bench allowed the set off of unabsorbed depreciation. The Tribunal referred to the observations made in the earlier case and upheld the CIT(A)'s order based on the Gujarat High Court's decision. The Tribunal dismissed the Revenue's appeal, aligning with the precedent set by the higher judicial forum.

In conclusion, the Tribunal dismissed the Revenue's appeal on both issues, affirming the decisions of the CIT(A) based on relevant legal precedents. The judgments were pronounced on 21st February 2018 by the members of the Appellate Tribunal ITAT Mumbai, Shri C.N. Prasad, Judicial Member, and Shri A.L. Saini, Accountant Member.