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TMI Blog2022 (6) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed under section 36(1)(va) of the Act and the actual dates of payment reported, thus clearly indicates the deviation which attracts such disallowance. A plain reading of section 143(1)(iv) of the Act also specifically states that that an adjustment can be made in respect of disallowance of expenditure/increase in income indicated an audit report but not taken into account in computing the total income of the assessee in the return of income. CIT(A) has not erred in facts and law in coming to the conclusion that disallowance made by the CPC u/s 143(1) of the I.T. Act on account of appellant's failure to pay the employee's contribution of PF/ESI within the prescribed due dates as per section 36(1)(va) is strictly in accordance with law. - Decided against assessee. - ITA No. 100/Ahd/2022 - - - Dated:- 8-6-2022 - Shri Waseem Ahmed, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member For the Assessee : None For the Revenue : Shri Abhimanyu Singh Yadav, Sr. D.R. ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:- This is an appeal filed by the assessee against the order of the National Faceless Appeal Centre (NFAC), Delhi in DI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(a) of the Act. On merits, the Ld. CIT(A) made the following observations: 5.26. In the case of Commissioner of Income Tax II Vs Gujarat State Road Transport Corporation [2014] 41 taxmann.com 100/366 ITR 170/223 the Hon'ble Gujarat High Court had considered the decision in the case of Alom Extrusions Ltd rendered by the Hon'ble Supreme Court in detail and the difference between employees' contribution and employers' contribution as under: 7.07. Now so far as the reliance placed upon the decision of the Hon'ble Supreme Court in the case of Alom Extrusions Ltd. (supra), by the learned IT AT as well as learned advocates appearing on behalf of the assesses in support of their submission that in view of amendment in section 43B pursuant to Finance Act, 2003, by which the second proviso to section 43B has been deleted and therefore even with respect to employees contribution despite section 36(1)(va), and explanation to section 36(1)(va), if the employees' contribution is credited after the due date mentioned in the particular Act but credited on or before the due date by filing return under section 139 of the Act, assessee shall be entitled to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... employees' contribution to PF Account / ESI Account made by the AO as, as such, such sums were not credited by the respective assessee to the employees' accounts in the relevant fund or funds (in the present case Provident Fund and/or ESI Fund on or before the due date as per the explanation lo section,36(1 )(va) of the Act i.e. date by which the concerned assessee was required as an employer to credit employees' contribution to the employees' account in the Provident Fund under the Provident Fund Act and /or the ESI Fund under the ESI Act. . 5.46 From the discussions above, it is also clear that the clarificatory amendment brought in by the Finance Act, 2021 applies to the issue in the instant appeal also. The amendment clarifies that provisions of section 43B does not apply and deemed to have never been applied for the purpose of determining the due date for employee's contribution to PF/ESI. From the above judicial decisions and also the unambiguous wording of the now amended provisions of section 36(1) and 43B, it is clear that the employee's contribution can be allowed as a deduction only if it had been paid within the prescribed due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the record under section 154. In the absence of any specific provision in the Act, which disallows a deduction because a specific document specified in that section is not annexed to the return, the ITO cannot, under clause (iii) of the proviso to section 143(1)(a), disallow a claim or a deduction because, in his view, adequate evidence in support of such a claim or deduction is not before him. He can disallow a claim for deduction only if he is satisfied, on the basis of the material which is before him, that the assessee is not entitled to such a deduction Thus, from the above decision, it evident that CBDT Circular No. 581 dated 28-9-1990 makes it clear that the Board has viewed the scope of the powers to make prima facie adjustments under section 143(1)(a) as co-terminus with the power to rectify a mistake apparent from the record under section 154. Further, it would be useful to reproduce language of section 143(1) of the Act: Assessment. 143. (1) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, such return shall be processed in the following manner, namely:- (a) the total income or loss shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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