9911796707
TMI Blog2021 (2) TMI 277X X X X Extracts X X X X X X X X Extracts X X X X ..... Act by the Assessing Officer at CPC, Bengaluru determining the total income of the assessee at Rs. 40,14,930/- by making adjustment of Rs. 26,22,570/- U/s. 36(1)(va) of the Act. 3. The assessee preferred an appeal before the Ld. CIT(A) stating that the employee's contribution to Provident Fund and ESI of Rs. 26,22,570/- was remitted before the due date of filing of the return of income U/s. 139(1) of the Act and therefore, the same should not have been disallowed U/s. 36(1)(va) of the Act. The Ld. CIT(A) however, observed that though there are some decisions in favour of the assessee, there were decisions in favour of the Revenue as well. He further observed that the decision of the Hon'ble Supreme Court in the case of CIT vs. Alo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the same should be allowed as a deduction. 5. Your appellant submits that CIT(A) as well as the CPC erred in not treating the expenditure as allowable U/s. 37(1) of the Income Tax Act, 1961, as the payment of Employees and employer's contribution to PF and ESI was incurred in the course of business and for the purposes of business. 6. The Ld. CIT(A) ought to have considered the fact that in case of conflicting judgments by the High Courts, the view favourable to the appellant has to be considered. 7. For these and such other grounds that may be urged at the time of hearing your appellant prays that the Hon'ble Members may delete the addition of Rs. 26,22,570/-." 4. Learned Counsel for the assessee Shri M.V. Anil Kumar plac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the decision of the Hon'ble Supreme Court in the case of CIT vs. Alom Extrusions Ltd. (supra) is applicable to both the employer as well as employee's contribution to Provident Fund and ESI and if the assessee has not remitted the amount collected from the employees before the due date of filing of return of income U/s. 139(1) of the Act, then the same has to be disallowed and brought to tax. With these directions, the appeal of the assessee is allowed and the A.O. is further directed to reconsider the issue, if the contrary view is upheld by the Apex Court in the appeals before the Hon'ble Supreme Court on this issue. 6. In the result, the assessee's appeal is allowed for statistical purposes. Pronounced in the open ..... X X X X Extracts X X X X X X X X Extracts X X X X
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