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TMI Blog2018 (8) TMI 1362X X X X Extracts X X X X X X X X Extracts X X X X ..... nction of law and, therefore, we do not find any infirmity in the order of the Ld. CIT(A) and so we confirm the same. - Decided against the revenue. - I.T.A. Nos. 1796 to 1798/Kol/2017 - - - Dated:- 21-8-2018 - Shri J. Sudhakar Reddy, AM Shri A. T. Varkey, JM For the Appellant : Shri A. Bhattacharjee, Addl. CIT For the Respondent : Shri A. K. Tulsiyan, FCA ORDER Per Shri A.T.Varkey, JM All these appeals filed by the Revenue are against the separate orders of Ld. CIT(A)- 21, Kolkata dated 04.05.2017 for AY 2012-13 to 2014-15 respectively. Since grounds are identical and facts are common, we dispose of all these appeals by this consolidated order for the sake of convenience. 2. Ground nos. 1 to 4 of Revenue s appeal (is common in all the three appeals) are against the order of Ld. CIT(A) in deleting the addition on account of delayed payment of employees contribution towards Provident Fund. 3. Briefly stated facts are that according to AO the assessee failed to contribute to PF within the due date prescribed by the relevant statute, however, according to assessee, the assessee deposited the said amount before due date of filing of income tax return, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ully following the aforesaid decision, we dismiss the ground nos.1 to 4 of revenue s appeal for all the years under consideration. And since this is the sole issue for AY 2014-15 the appeal of the Revenue is dismissed for AY 2014-15. 5. Ground no. 5 of revenue s appeal for AY 2012-13 is against the action of Ld. CIT(A) in allowing the appeal of the assessee on interest expenditure on TDS debited in the P L A/c, which is according to AO is penal in nature. Briefly stated the facts according to AO are that the assessee debited ₹ 1,97,276/- in P L A/c. towards interest on TDS. Since, according to AO, the said expense is penal in nature, the said amount needs to be disallowed and he added it to the total income of the assessee. Aggrieved, assessee preferred an appeal before the Ld. CIT(A), who deleted the addition by observing that the interest paid for the delayed payment of TDS being compensatory in nature cannot be penal in nature and hence is an allowable deduction u/s. 37 of the Act. Aggrieved, revenue is before us. 6. We have heard rival submissions and gone through the facts and circumstances of the case. We note that the issue is squarely covered in favour of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permissible deduction under section 37, any interest payable for default committed by the assessee in discharging his statutory objection under the Act, which is calculated with reference to the tax on income, cannot be allowed as a deduction. Therefore, it was to be held that deduction of interest levied under sections 139 and 215 would not be allowable under section 37. In the above judgment, the claim of the assessee for interest expenses was denied as it defaulted to make the payment of advance tax as per the provisions of the Act. The advance tax is nothing but income tax only which the assessee has to pay on his income. In the instant case the default relates to the delay in the payment of advance tax and consequently interest was charged on the delayed payment of advance tax. In the above judgment the Hon ble Apex Court held that as Income Tax paid by the assessee is not allowable deduction and therefore interest emanating from the delayed payment of income tax (advance tax) is also not allowable deduction. However the facts of the instant case before us are distinguishable as in the case before us the interest was paid for delayed payment of service tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee and consequently the principles laid down by the Hon ble Apex Court in the case of Bharat Commerce Industries Ltd. Vs. CIT (1998) reported in 230 ITR 733 cannot be applied to the case on hand. Thus, in our considered view, the principle laid down by the Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd. (supra) is not applicable in the instant facts of the case. Thus, we hold that the Assessing Officer in the instant case has wrongly applied the principle laid down by the Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd.(supra). We also find that the Hon'ble Supreme Court in the case of Lachmandas Mathura (Supra) has allowed the deduction on account of interest on late deposit of sales tax u/s 37(1) of the Act. In view of the above, we conclude that the interest expenses claimed by the assessee on account of delayed deposit of service tax as well as TDS liability are allowable expenses u/s 37(1) of the Act. In this view of the matter, we find no reason to interfere in the order of Ld. CIT(A) and we uphold the same. Hence, this ground of Revenue is dismissed. Respectfully following the aforesaid decision, we con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lti shift working with existing vehicles. 8. According to AO, the above explanation put forward by the assessee is devoid of any merit, because no record was maintained by the assessee to substantiate that all the 149 (125 + 24) Tippers have been put to work on average for 25 days in a month and even if worked for 2 shifts for the entire 12 months does not work out to the expense claimed by the assessee. Moreover, according to AO, the said truck helpers are casual wage earners and not subjected within the purview of statutory PF ESI. Therefore, the genuineness of such huge expense by mode of cash payment to truck helpers remained unverifiable. Further, he also observed that the increase in expense towards wages to truck helpers of ₹ 76,05,312/ - (12605952-5000640) in comparison to immediate previous year and does not commensurate with expense involved for additional 24 new Tippers acquired during the F.Y. Even if it is assumed the new 24 numbers of Tippers worked for 25 days in a month making two shifts and the wages is ₹ 250/ - per helper per day, the additional cost comes to ₹ 36,00,000/ - as explained by the assessee does not match with the enhancement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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