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TMI Blog2022 (6) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year is assailed on the following grounds: 1. That the order of Ld. CIT(A) is against the law and facts of the case. 2. That the Ld. CIT(A) has grossly erred in upholding the illegal intimation order passed u/s. 143(1) by the AO, CPC, Bangalore whereby disallowance of Rs. 10,75,897/- has been made of the payments made towards EPF and ESI, contrary to the statutory provisions as well as, well settled law laid down by the Hon'ble Supreme Court and Hon'ble jurisdictional High Court. 3. That the Ld. CIT(A), has grossly erred in dismissing the appeal of the assessee by applying the amendment in law retrospectively, whereas the said amendment is applicable from 1.4.2021 and not applicable to the year under consideration as interpreted by various Hon'ble courts. 4. That the Ld. CIT(A) has grossly erred in upholding the intimation order passed u/s. 143(1) by the AO, CPC, Bangalore without appreciating the fact that intimation order is without proper jurisdiction, passed without proper and reasonable opportunity of being heard beyond the scope and powers enshrined u/s. 143(1). 5. Without prejudice to the aforesaid grounds of appeal and strictly in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 01.11.2021. In the facts of the present case also, it is seen that the amendments carried out by the Finance Act, 2021 in Section 36(1)(va) and 43B were considered by the First Appellate Authority to be clarificatory in nature, hence, retrospective in operation. We have seen that this issue has been considered by the jurisdictional High Court in the case of CIT Vs. Hernia Embroidery Mills (P) Ltd. (2014) 366 ITR 167 (P H). The jurisdictional High Court relying upon its own decision in the case of CIT Vs. Rai Agro Industries 334 ITR 122 and considering the principle laid down by the Apex Court in the case of CIT Vs. Alom Extrusions Ltd. 319 ITR 306 (S.C.) have addressed the legal position, though it need be clarified that the decision rendered was in the context of amendments carried out by way of Second Proviso to Section 43B which was omitted by Finance Act, 2003. This Amendment was held to be clarificatory and hence would operate retrospectively. In the facts of the present case, Amendment by way of Explanation 2 to Section 36(va) and Explanation 5 to Section 43B by Finance Act, 2021 had been held to be having prospective effect. For the said purposes relying upon the N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 021 in the case of Ajay Piplani Vs. Assistant Director of Income Tax, CPC, Bengaluru in ITA No. 114/CHD/2021. Similar view has been expressed by the Delhi Benches vide order dated 03.08.2021 in Insta Exhibitions Pvt. Ltd. Vs. Addl. CIT, New Delhi in ITA No. 6941/Del/2017, Hyderabad Benches vide order dated 01.07.2021 in M/s. Crescent Roadways Pvt. Ltd. V. Dy. CIT, Hyderabad in ITA No. 1952/Hyd./2018. We find that the issue has been elaborately discussed by the Co-ordinate Benches for example in Insta Exhibitions Pvt. Ltd. (supra) as under: 6. We have carefully considered contentions of the learned departmental representative and perused the orders of the lower authorities. The facts shows that the assessee has collected the sum of Rs. 12,16,260/- being employee's contribution under the provident fund and with respect to ESI laws. The above contribution was admittedly not deposited by the assessee within the due date prescribed under the respective ESI and PF statue however, same was deposited before the due date of filing of return of income. Therefore, the Ld. AO as well as the Ld. CIT(A) disallowed the same holding that such contribution becomes the income of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... :- Clause 8 of the Bill seeks to amend section 36 of the Income-tax Act, relating to other deductions. Sub-section (1) of the said section provides for allowing of deductions provided for in the clauses thereof for computing the income referred to in section 28 of the said Act. Clause (va) of the said sub-section provides for allowance of deduction for any sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 apply, if such sum is credited by the assessee to the employee's account in the relevant fund or funds on or before the due date. Explanation to the said clause provides that for the purposes of this clause, due date means the date by which the assessee is required as an employer to credit an employee's contribution to the employee's account in the relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise. It is proposed to insert Explanation 2 to clause (va) of sub-section (1) of the said section so as to clarify that the provisions of section 43B shall not apply and shall be deemed never to have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mming up the legal position on similar facts is extracted hereunder from M/s. A.K. Creative Outsourcing Services Pvt. Ltd.: 5. We have heard the submissions and perused the material available on record. Considering the issue, it is seen that it is no longer res-integra. The controversy whether the Amendments carried out by the Finance Act, 2021 in Section 36(1)(va) and u/s. 43B of the Act were prospective in nature or retrospective, hence clarificatory in nature have been put to rest by consistent orders of the different Benches of the ITAT namely order dated 03.08.2021 in Insta Exhibitions Pvt. Ltd. Vs. Addl. CIT, New Delhi in ITA No. 6941/Del/2017 of the Delhi Benches; order dated 01.07.2021 of Hyderabad Benches in M/s. Crescent Roadways Pvt. Ltd. V. Dy. CIT, Hyderabad in ITA No. 1952/Hyd./2018, order dated 27.08.2021 in the case of M/s. Jupiter Aqua Lines Pvt. Ltd. Vs. DCIT ITA 83/CHD/2021 and order dated 04.10.2021 in the case of Ajay Piplani Vs. Assistant Director of Income Tax, CPC, Bengaluru in ITA No. 114/CHD/2021 of the ITAT Chandigarh Benches. Reference may also be made to various other orders of the Chandigarh Benches in ITA 250/CHD/2021 in the case of Shri Sukhdev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een relied upon. The said decision, it is seen, specifically deals with the employees' contribution. Their Lordships relying upon decision of the Apex Court in the case of CIT Vs. Alom Extrusions Ltd. (2009) 319 ITR 306 (which was in the context of employers' contribution) referring to the decision of the Hon'ble Delhi High Court in the case of CIT Vs. Aimil Ltd. (2010) 321 ITR 508 took specific cognizance of the fact that this decision pertained to the employee's contribution wherein again a reference had been made to the decision of the Apex Court in the case of CIT Vs. Vinay Cement 313 ITR 1. Considering the reasoning in these decisions, Their Lordships in the case of Nipso Polyfabriks Ltd. (supra) consciously followed the view taken by the Hon'ble Delhi High Court in Aimil's case and concluded that the view expressed by the Hon'ble Kerala High Court in CIT Vs. Commonwealth Trust Ltd. (2004) 269 ITR 290 was not being followed as it was considered to be no longer good law in view of the judgment of the Apex Court in Alom Extrusions Ltd. Accordingly, reliance placed by the Ld. AR on the decision of the jurisdictional High Court qua the employee's ..... X X X X Extracts X X X X X X X X Extracts X X X X
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