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TMI Blog2021 (11) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... hold that the Ld. CIT(A) is not justified in sustaining the adjustment made by the A.O-CPC on account of belated payment of employees contribution to PF ESI. Therefore, set aside the order of the Ld. CIT(A) and direct the A.O. to delete the disallowance. The grounds raised by the assessee are accordingly allowed. - ITA.No.1823/Del./2020 - - - Dated:- 13-10-2021 - Shri R.K. Panda, Accountant Member For the Assessee : Shri Vijay Gupta, Advocate For the Revenue : Shri Rajesh Kumar Dhanesta, Sr. DR ORDER This appeal filed by the Assessee is directed against the Order dated 25.08.2020 of the Ld. CIT(A)-9, New Delhi, relating to the A.Y. 2018-2019. 2. Although a number of grounds have been raised by the assessee, howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961, in respect of delayed payment of employees contribution towards PF ESI paid before the due date of filing of the income tax return amounting to ₹ 21,40,164/-. 4. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal. 5. Learned Counsel for the Assessee submitted that in the Finance Bill 2021, amendments were made in Sections 36 and 43B vide Clauses 8 and 9 and in the Memorandum of Explanation according to which the amendments will take effect from 01.04.2021 and will accordingly apply to A.Y. 2021-2022 and subsequent assessment years. He submitted that Section 1 (2)(a) of Finance Act, 2021 specifically mentions that Sections 2 to 88 shall come into force on the First Day of April, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontribution to PF ESI before the specified dates as mentioned in the Statute, therefore, the Ld. CIT(A) was fully justified in sustaining the addition made by the CPC. He submitted that there are various decisions in favour of the Revenue where the Hon ble Courts have held that the Amendment by Finance Act, 2015 in Section 43B is restricted only in respect of employers contribution to PF ESI and if the same is paid on or before the due date of filing of the income tax return under section 139(1), the same is an allowable deduction under section 43B of the I.T. Act, 1961. However, the same amendment would not be applicable for the belated payment to employees contribution to PF ESI. He submitted that since the assessee has received th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e been made before the due date of filing of the income tax return under section 139(1), therefore, in view of the consistent decisions of the Coordinate Benches of the Tribunal, the same does not call for any disallowance. It is also his submission that after the decision of the Hon ble Delhi High Court in the case of CIT vs., M/s. Bharat Hotels Ltd., (supra), the Hon ble Delhi High Court in the case of PCIT vs., Pro Interactive Service (India) Pvt. Ltd., vide ITA.No.983/2018 order dated 10.09.2018 has held that no disallowance is called for where the assessee had paid the employees contribution to PF ESI before the due date of furnishing of return of income under section 139(1) of the I.T. Act, 1961. 7.1. I find the Hon ble Delhi Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ld CIT(A) disallowed the same holding that such contribution becomes the income of the assessee under the provision of section 2(24)(x) of the Act and thereafter if the same is deposit within the due date prescribed under the respective laws then same is allowable as deduction u/s 36(1)(va) of the Act. Coordinate bench in case of DCIT Vs Dee Development Engineers in ITA No. 4959/DEL/2016 ( A.Y 2011-12) has held as Under:- 7. We have heard both the parties and perused all the relevant material available on record. As regards Ground No. 1, the assessee company has not deposited the employees contribution within the due date which is prescribed under the said statute i.e. Provident Fund and ESIC. This issue is dealt by the Hon ble D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is added u/s 36 (1) (va) of the act with effect from 1 April 2021, is applicable to the present case, we referred to the Notes on clauses at the time of introduction of the finance bill 2021 which says as Under:- Clause 8 of the Bill seeks to amend section 36 of the Income tax Act, relating to other deductions. Sub-section (1) of the said section provides for allowing of deductions provided for in the clauses thereof for computing the income referred to in section 28 of the said Act. Clause (va) of the said sub-section provides for allowance of deduction for any sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 apply, if such sum is credited by the assessee t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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