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TMI Blog2014 (12) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... levant AY - a grace period of five days is available to the employer even after the due date for deposit of PF under Provident Fund Act - assessee has deposited the contribution within the grace period - when the assessee had made a payment within the grace period, then it can be safely said that the assessee had made the payment within the due date under the Provident Fund Act, the requirement of section 43B even otherwise is deemed to be complied with – the order of the CIT(A) is upheld – Decided against revenue. Deemed dividend u/s 2(22)(e) – Held that:- CIT(A) was rightly of the view that the payee company was a public limited company, hence the provisions of section 2(22)(e) were not attracted to the company - the amount was not in the form of loan or advance but it was inter-corporate deposit upon which the interest payment had been made by the assessee after deducting TDS as per law - the payment was made to the assessee company in the ordinary course of business - since the payee company is a public limited company and the inter-corporate deposits were made due to business exigencies and in the ordinary course of business, the provisions of section 2(22)(e) are not attra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he way of interest, which is not directly attributable to any particular income or receipt, the disallowance has to be computed in accordance with procedure laid down under that Rule only. 3. Whether on the facts and circumstances of the case and in law, the Ld. CIT (A) was justified in deleting the addition of ₹ 9,770/-, made on account of Employee's Contr ibut ion to Provident Fund without appreciating the fact that in view of the decision of Hon'ble ITAT 'C Bench Kolkata in the case of Bengal Chemical and Pharmaceuticals Ltd (11 Taxmann.com 328) (2011), the assessee is not entitled to deduction u/s.36(1)(va) in respect of Employees Contribution to P.F. if it is paid after due date as specified in Explanation to section 36(1)(va) on the basis of provisions of section 43B, because said section comes into play only when a deduction is otherwise allowable under Act. 4. Whether on the facts and circumstances of the case and in law, the ld. CIT(A) was justified in deleting the addition of ₹ 1,00,00,000/- made u/s. 2(22)(e) of the I.T. Act, 1961 without appreciating the fact that the assessee failed to substantiate its claim that money lended was in ordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on this issue. Grounds No.1 2 of the Revenue are therefore dismissed. Ground No.3 8. Vide ground No.3, the Revenue has agitated the deletion of disallowance relating to addition made by the AO on account of late deposit of Employees Contribution to Provident Fund. The AO had made the disallowance observing that the contribution to Employees Provident Fund was paid by the assessee after the due date as specified in explanation to section 36(1)(va). 9. The Ld. CIT(A) deleted the said disallowance while relying upon the decision of the Hon ble Supreme Court in the case of CIT vs. Alom Extrusions Ltd. reported in 185 Taxman 416 (SC) wherein the Hon ble Supreme Court has held that the effect of deletion of second proviso to section 43B of Finance Act, 2003 is retrospective therefore, the assessee would be entitled to claim the benefit of deduction if the amount of contribution to Employees Provident Fund is deposited on or before the due date of filing of return for the relevant assessment year. Even we find that a grace period of five days is available to the employer even after the due date for deposit of PF under Provident Fund Act. The assessee in this case has depos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (22)(e) are not attracted. The order of the Ld. CIT(A) on this issue is therefore upheld. Ground No.5 13. Vide ground No.5, the Revenue has agitated the action of the Ld. CIT(A) in deleting the disallowance of ₹ 27,324/- relating to club entry fees. The AO observed that the payment made for obtaining club membership was not an allowable expenditure. He further observed that in the case in hand, the expenditure had been incurred only for the benefit of selected few executives and not for the benefit of employees at large. He therefore disallowed the said club entrance fees of ₹ 27,324/-. 14. In appeal, the Ld. CIT(A), after considering the submissions of the assessee, held that from the evidences, it was established that the expenses were incurred by the directors of the assessee company for the purpose of promoting the business activity of the assessee company. He therefore held that the expenditure was revenue in nature. He also observed that the expenditure was not incurred for obtaining club membership. After considering the overall facts and circumstances of the case, he held that the said expenditure was allowable as revenue expenditure. 15. After consi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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