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TMI Blog2022 (5) TMI 1345X X X X Extracts X X X X X X X X Extracts X X X X ..... ibution of Provident fund ESIC before the due date of return of income u/sec 139(1) of the Act. Accordingly, we set-aside the order of the CIT(A) and direct the assessing officer to delete the disallowance and allow the grounds of appeal in favour of the assessee. - ITA No. 2336/MUM/2021 - - - Dated:- 26-5-2022 - Shri M. Balaganesh (Accountant Member) And Shri Pavan Kumar Gadale (Judicial Member) For the Assessee : Mr. Nitesh Thakkar, AR For the Revenue : Ms. Samruddhi Hande, DR ORDER PER PAVAN KUMAR GADALE, JM The assessee has filed an appeal against the order of National Faceless Appeal Centre (NFAC) order passed u/s 143(1) and 250 of the Income Tax Act, 1961 (in short the Act ). The Revenue has raised fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble Bombay High Court, the addition made of Rs.22 95.056/- be deleted. 3. The ld. CIT(A) has erred in confirming the addition of Rs.22,95,056/- being payment of Employees contribution towards Provident Fund and ESIC by incorrectly interpreting the amended provisions of Sections 36(va) as well as 43B of Income tax Act vide Finance Act, 2021. It is submitted that Memorandum and Finance Bill clearly suggest that these amendments will take effect from 1st April, 2021 and will accordingly apply to the assessment year 2 021-22 and subsequent assessment years. In view of this, the amended provisions of Sections 36(va) as well as 43B vide Finance Act, 2021 will apply prospectively and not retrospectively to the year under consideratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cisions and paper book and prayed for allowing the appeal. 5. Contra, the Ld. DR submitted that the explanation 2 to Sec 36(1)(va) of the Act in finance Act 2021 was introduced and the amendment is applicable to the earlier years and supported the order of the CIT(A) appeal. 6. We heard the rival submissions and perused the material available on record. The ld. AR s contentions are that the assessee for the various reasons could not deposit the employees contribution to provident fund ESIC within the time allowed under prescribed Act. Whereas, the assessee has deposited the amount before filing of the return of income U/sec139(1) of the Act. The Ld. AR submitted that the assessee has complied with the provisions of Law and deposited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... standing order, award, contract of service or otherwise , one cannot find fault in what has been reported in the tax audit report. It is not even an expression of opinion about the allowability of deduction or otherwise; it is just a factual report about the fact of payments and the fact of the due date as per the Explanation to Section 36(1)(va).This due date, however, has not been found to be decisive in the light of the law laid down by Hon'ble Courts above, and it cannot, therefore, be said that the reporting of payment beyond this due date in the tax audit report constituted disallowance of expenditure indicated in the audit report but not taking into account in the computation of total income in the return as is sinequa non for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o whether if such an adjustment was to be permissible in the scheme of Section 143(1), whether the insertion of Explanation 2 to Section 36(1)(va), with effect from 1st April 2021, must mean that so far as the assessment years prior to the assessment years 2021-22 are concerned, the provisions of Section 43B cannot be applied for determining the due date under Explanation (now Explanation 1) to Section 36(1)(va). That question, in our humble understanding, can be relevant, for example, when a call is required to be taken on merits in respect of an assessment under section 143(3) or under section 143(3) r.w.s. 147 of the Act, or when no findings were to be given on the scope of permissible adjustments under section 143(1)(a)(iv). That is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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