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TMI Blog2022 (4) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... contribution to PF and ESI is allowable deduction if the same is paid before the due date of filing the return of income - Tribunal in the case of Andhra Trade Development Corporation [ 2021 (5) TMI 263 - ITAT VISAKHAPATNAM] held that debatable issues are not permitted to be made adjustments while processing the return of income u/s 143(1) - Decided in favour of assessee. - I.T.A.No.115/Viz/2021 - - - Dated:- 31-3-2022 - Shri Laliet Kumar, Hon ble Judicial Member And Shri S Balakrishnan, Hon ble Accountant Member For the Appellant : Shri Prabhakara Murthy, AR For the Respondent : Shri SPG Mudaliar, DR ORDER PER SHRI LALIET KUMAR, JUDICIAL MEMBER This appeal is filed by the assessee against the order of the Commissioner of Income Tax (Appeals) [for short, CIT(A) ], National Faceless Appeal Centre (NFAC), Delhi in DIN Order No.ITBA/NFAC/S/250/2021-22/1032432753(1) dated 15.04.2021 for the Assessment Year (A.Y.) 2019-20. 2. Brief facts of the case are that the assessee, filed his return of income, declaring total income of ₹ 38,12,596/-. However, the Centralized Processing Centre (CPC) has made an addition of ₹ 5,01,024/- u/s 36(1)(va) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und contribution from employees ₹ 4,37,084/ in total ₹ 5,01,024/- ) , in the impugned intimation u/s 143(1) of I.T. Act invoking the provisions of section 36(1) (va) of I.T. Act, more particularly in the light of the fact that , all the amounts were paid (in some of the months well before the financial year ending as on 31-03-2019 and in case of remaining months well before the due date for filing of return of income ) well within the due date for filing of return of income as per provisions of section 139(1) of Income-Tax Act, 1961, a fact clearly emanating from record. 2.1. The said amount of ₹ 5,01,024/- is allowable deduction as per decisions rendered by various judicial forums, more particularly jurisdictional Tribunal i.e TAT, Visakhapatnam and should have been allowed while processing the return of income vide impugned intimation u/s 143(1) of I.T. Act. 3. For these grounds and any other grounds that may be urged during the course of hearing of appeal the appellant humbly prays the Hon'ble Income Tax Appellate Tribunal to accept income from business or profession as returned at ₹ 38,12,596/- by allowing the Employees Contribution of ESI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ld. CIT(A) and dismiss the appeal of the Revenue. 7. Since, the facts are identical respectfully following the view taken by this Tribunal, we hold that the addition made by the CPC u/s 143(1) is unsustainable, accordingly deleted. The appeal of the assessee is allowed. 8. On merits also, this Tribunal has consistently viewed that the employees contribution to PF and ESI is allowable deduction if the same is paid before the due date of filing the return of income. In the case of APEPDCL in I.T.A.No.609/V/2014 dated 29.07.2016, the coordinate bench of ITAT, Visakhapatnam after considering the decision of Hon ble Karnataka High Court in the case of Essae Teraoka (P) Ltd. Vs. DCIT 366 ITR 408 and the decision of coordinate bench of ITAT Hyderabad in the case of Tetra Soft (India) Pvt. Ltd. Vs. ACIT (2015) 40 ITR (Trib) 470 and also taking support from the decision of Hon ble Supreme Court in the case of CIT Vs. M/s Vegetables Products Ltd., 88 ITR 192, decided the issue in favour of the assessee. For the sake of clarity and convenience, we extract para No.5 to 10 which reads as under: 5. We have heard both the parties, perused the materials available on record and gon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Paragraph 32 provides for recovery of member share of contribution and as per the scheme, the employer can recover the employees share from the wages paid to the employee. Therefore, as per the PF Act and scheme of contributions, the contributions means and include both employees and employer s share. Similarly, section 2(c) of the Provident Fund Act defines the contribution to mean a contribution payable in respect of a member under the scheme or the contribution payable in respect of an employee to whom the scheme applies. There is a prescribed mode of payment of contributions under the PF Act. Under the said Act, the employer shall contribute both employees and employer share along with administrative charges before the due date specified under the PF Act. The Act prescribed only one due date for depositing the contribution i.e. 15th of subsequent month with the grace period of 5 days which indicates that there is no difference between employee and employer contribution. If the legislature intends to differentiate employees and employer contribution, then there would have been two due dates like in the case of Income Tax Act. Therefore, from the above, it is clear that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provident fund up to the due date as prescribed under relevant statute, but before due date of filing of return no disallowance could be made in view of the provisions of section 43B of the Act. In the case of CIT Vs. Udaipur Dugdh Utpadak Sahakari Sangh Ltd. 35 Taxman 616, the Hon ble High Court of Rajasthan, after referring to the apex court decision in the case of CIT Vs. Alom Extrusions Ltd. 319 ITR 306 CIT Vs. Vinay Cement Ltd. held that the deductions should be allowed for the payment of employees contribution made before the due date of filing of return. Similarly, in the case of CIT Vs. State Bank of Bikaner, the Hon ble Rajasthan High Court held that contribution paid after the due date under the respective Act, but before filing the return of income u/s 139(1) of the Act cannot be disallowed u/s 43B of the Act and or u/s 36(1)(va) of the Act. 9. The Ld. D.R. relied upon the decision of Hon ble High Court of Kerala, in the case of CIT vs. Merchem Ltd, reported in (2015) 378 ITR 443 and submitted that employees contribution to provident fund is allowed as deduction, if the same is deposited on or before the due date specified under the provisions of provident fund ..... X X X X Extracts X X X X X X X X Extracts X X X X
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