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TMI Blog2022 (2) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year under consideration is A.Y. 2018-19, the amendment does not apply to the assessment year under consideration - no disallowance was warranted in the present case. We, therefore direct the AO to delete the addition. Thus the assessee s ground is allowed. Claim of Education Cess as an allowable expenditure - HELD THAT:- As respectfully following the decision of the Coordinate Bench of the Tribunal in the case of EXL Services.com India Pvt. Ltd., New Delhi vs., ACIT, Large Taxpayer Unit, Circle 1, New Delhi ( 2021 (9) TMI 361 - ITAT DELHI ), direct the AO to allow the claim of deduction. Thus the ground of assessee is allowed. - ITA.Nos.1245 And 1246/Del./2021 And ITA.No.1386/Del./2021 - - - Dated:- 31-1-2022 - Shri Anil Chaturvedi, Accountant Member And Shri Amit Shukla, Judicial Member For the Assessees : Shri Suresh Gupta, C.A. And Shri Vivek Mittal, C.A. For the Revenue : Shri Sanjay Tripathi, Sr. D.R. ORDER PER BENCH : These appeals by the assessee are preferred against the orders of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) - Delhi dated 03.08.2021 (for ITA Nos. 1245 1246/Del/2021) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 12,42,091/-). 2. The Ld CIT(A) has grossly erred both on facts and in law in upholding impugned addition of ₹ 20,52,429/- u/s 36(1)(va) of the IT Act for delayed deposit of employee shares of ESI/PF in view of the Explanation 2 inserted in section 36(1)(va) by Finance Act 2021 ignoring the fact that above Explanation is not applicable for the year under consideration. (Tax effect: ₹ 12,42,091/-) 3. Whether on the facts and in the circumstances of the case and position on law, the Education Cess and the Secondary and Higher Education Cess amounting to ₹ 1,15,677/- is a disallowable expenditure u/s 40(a)(ia) of the Act, 1961. (Tax effect : ₹ 31,785/-) The above ground is an additional ground. 4. The appellant craves leave to add, delete, modify/amend the above grounds of appeal with the permission of the Hon ble appellant authority. 4. The similar grounds have been raised in ITA No.1246/Del/2021 for A.Y. 2019-20 1386/Del/2021 for A.Y. 2018-19. 5. Ground No.1 2 are with respect to the disallowance u/s 36(1)(va) of the Act. 6. Before us, Learned AR submitted that during the year under consideration that there was delayed deposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce Act 2021 is concerned, notes on clauses to the Finance Bill 2021 clearly states that the amendment will take effect from 1st April 2021 and will apply in relation to the assessment year 2021-22 and subsequent assessment year. In such a situation, we are of the view that since the assessment year under consideration is A.Y. 2018-19, the amendment does not apply to the assessment year under consideration. As far as the reliance of Revenue on the decision of Vedvan Consultants Pvt. Ltd. (supra) is concerned, we find that the various Division Benches of the Delhi other Tribunal have held the delayed deposits of PF/ESIC Contributions to be allowable if the same are deposited with the appropriate authorities before filing of return of income by the assessee. Further, it is settled law that when two judgments are available giving different views, then the judgment which is in favour of the assessee shall apply as held in case of Vegetable Products Ltd. 82 ITR 192 by the Hon ble Supreme Court. We, therefore, following the decision rendered by Hon ble Apex Court in the case of M/s. Vegetable Products Ltd. (supra) and AIMIL Ltd. (supra), are of the view that no disallowance was warra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the head profits and gains from business or profession as it does not fall within section 40(a)(ii) of the Act, 1961. He submitted that the Hon ble Bombay High Court in the case of Sesa Goa Ltd. vs. JCIT: 117 taxmann.com 96 has also held that education cess is to be an allowable expenditure. He, therefore, submitted that education cess being not in the nature of tax and not being disallowable expenditure under section 40(a)(ia) of the I.T. Act, 1961, the claim of deduction be allowed. 15. The Ld. D.R. did not controvert to the submissions but however submitted that the aforesaid ground is raised for the first time before Hon ble ITAT and it was not raised before lower authorities. 16. We have heard the rival submissions and perused the material available on record. The issue in the present ground is with respect to the claim of ₹ 1,15,677/- on account of deduction on education cess. Before us, it is the Learned A.R s contention that assessee has paid education cess which was not claimed as deduction in the return of income filed by the assessee and that now assessee seeks its deduction. We find that similar issue arose in the case of EXL Services.com India Pvt. L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arlier years and for similar reasons direct the AO to allow the claim of deductibility of cess amounting to ₹ 70,98,828/-. Thus the ground of the assessee is allowed. 17. Before us, Revenue has not placed any material to demonstrate that the order of the Tribunal in the case of EXL Services Company Ltd. (supra) has been set aside / stayed or overruled by higher judicial forum. Further, Revenue has also not pointed to any distinguishing facts in the present case and that of EXL Services.com Ltd. (supra). We therefore, respectfully following the decision of the Coordinate Bench of the Tribunal in the case of EXL Services.com India Pvt. Ltd., New Delhi vs., ACIT, Large Taxpayer Unit, Circle 1, New Delhi (supra), direct the AO to allow the claim of deduction. Thus the ground of assessee is allowed. 18. In the result, ITA.No.1245/Del./2021 of the assessee is allowed. 19. As far as the assessee s appeal for the A.Y. 2019- 20 [ITA.No.1246/Del./2021] is concerned, it is the submission that facts are identical to that of A.Y. 2018-19. 20. Therefore, respectfully following the reasons for decision taken in the A.Y. 2018-19, we allow the appeal of the assessee for t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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