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TMI Blog2022 (3) TMI 1070X X X X Extracts X X X X X X X X Extracts X X X X ..... ions referred to by us in the earlier paragraph of this order on identical issue the tribunal has taken a view that the aforesaid amendment is applicable only prospectively i.e., from 1.4.2021. We are therefore of the view that the impugned additions made under section 36(1)(va) of the Act, deserves to be deleted. Assessee received a sum from the Government of Karnataka - Karnataka Government, with a view to promote efficiency of public enterprises in Karnataka and to encourage pay dividends regularly to the Government, announced an award called Chief Minister's Annual Ratna Award - HELD THAT:- From perusal of the proceedings of the Government of Karnataka dated 29.12.2016, it is clear that the award was given for the criteria of earning sustained profits. For 3 Financial Years, dividends should be paid to the Government and significant CSIR activities should have been undertaken each year. The requirements of section 10(17A) of the Act are that award should have been instituted in public interest by Central Government or State Government. The criteria for exemption under section 10(17A) of the Act is therefore public interest which is absent in the present case and ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mited (order dated 19.05.2021) it has been held that the amended provisions of section 36(1)(va) has no application since this amendment is applicable from 01.04.2021 onwards and it is further held that it should be understood that the legislature itself has condoned the impugned default before 01.04.2021. Further, in the recent Judgments of Income Tax Appellate Tribunal, Bangalore in the case of M/s. Nirmal Enviro Solutions Private Limited (order dated 12.10.2021), M/s. The Continental Restaurant Caf Co. (order dated 11.10.2021) and Shri Gopala Krishna Aswini Kumar (order dated 13.10.2021) have held that amendment made in section 36(1)(va) is applicable only with effect from 01.04.2021. 5. The learned CIT(A) has erred treating award received from Government of Karnataka as taxable income though such receipt of award is exempt u/s. 10(17A). 6. The AO has not given the credit of TDS deducted by the Karnataka High Court of ₹ 96,654/-. AO should be directed to give credit of TDS as per form 16A. 7. With these and such other grounds that might be urged at the time of hearing the appellant prays for the relief sought for. 2. Ground Nos. 1 and 7 raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so held that Section 43B of the Income-tax Act relates to allowing certain deductions only on actual payments. Clause (b) of the said section provides that any sum payable by the assessee as an employer by way of contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the welfare of employees shall be allowed (irrespective of the previous year in which the liability to pay such sum was incurred by the assessee according to the method of accounting regularly employed by him) only in computing the income referred to in section 28 of that previous year, in which such sum is actually paid by him. Proviso to the said section provides that nothing contained in this section shall apply in relation to any sum which is actually paid by the assessee on or before the due date applicable in his case for furnishing the return of income under sub-section (1) of section 139 in respect of the previous year in which the liability to pay such sum was incurred as aforesaid and the evidence of such payment is furnished by the assessee along with such return. By virtue of insertion of Explanation 5 to this section, the provisions of the said section shall not ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .A. No. 2197/HYD/2017 [Assessment Year: 2013-14] dated 19.05.2021 Mohan Ram Chaudhary vs. ITO ITA No. 51 54-55/Jodh/2021 [Assessment Year: 2018-19] dated 28.09.2021 8. The Hon'ble Karnataka High Court in the case of Essae Teraoka Pvt. Ltd., (supra) has taken the view that employee's contribution under section 36(1)(va) of the Act would also be covered under section 43B of the Act and therefore if the share of the employee's share of contribution is made on or before due date for furnishing the return of income under section 139(1) of the Act, then the assessee would be entitled to claim deduction. Therefore, the issue is covered by the decision of the Hon'ble Karnataka High Court. In this case there is no dispute that the assessee made payment of the Employees share of PF/ESI on or before the due date for filing return of income for AY 2017-18 u/s. 139(1) of the Act. The next aspect to be considered is whether the amendment to the provisions to section 43B and 36(1)(va) of the Act by the Finance Act, 2021, has to be construed as retrospective and applicable for the period prior to 01.04.2021 also. On this aspect, we find that the explanatory memorandum to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter's Annual Rathna award for the year 2016-17 with a cash prize of ₹ 3.75 lakhs per enterprise. 1. Karnataka State Seeds Corporation Limited 2. Karnataka Silk Industries Corporation Limited 3. Karnataka Soaps and Detergents Limited 4. Karnataka State Electronics Development Corporation Limited Hence, the following order. 11. The assessee claimed a sum of ₹ 3,75,000/- received from Government of Karnataka as exemption under section 10(17A) of the Act. 12. In an intimation issued under section 143(1) of the Act dated 24.12.2019, the claim for exemption was denied. On appeal by the assessee, the First Appellate Authority confirmed the order of the AO for the reason that the assessee failed to furnish details with regard to award given by Government of Karnataka. 13. We have heard the rival submissions. 14. From perusal of the proceedings of the Government of Karnataka dated 29.12.2016, it is clear that the award was given for the criteria of earning sustained profits. For 3 Financial Years, dividends should be paid to the Government and significant CSIR activities should have been undertaken each year. The requirements of section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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