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TMI Blog2022 (3) TMI 1410X X X X Extracts X X X X X X X X Extracts X X X X ..... ls and documents on record the confirmation of the addition of employees' contribution of Rs.5,40,169/- to PF and Rs.8494/- to ESI (total contribution Rs.5,48,663/-) paid on or before due date of filing of return is arbitrary, unjust and bad ain law both on facts and in law. 2. Without prejudice to the above, the CIT(A), NFAC erred in confirming the aforesaid addition without properly considering the relevant law and the decision of Territorial ITAT Indore Bench, Indore and various other ITAT benches and High Court decisions in the favour of the Appellant. 3. Without prejudice to the above, the CIT(A), NFAC failed to appreciate that the relevant amendments in the Income Tax Act 1961 is prospective in nature and therefore not applicabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Limited (2010) 321 ITR 508. The Ld. A.R. submitted that prima facie adjustment under Section 36(1)(va) of the Act could not be made as the same was beyond the scope of provisions of Section 143(1) of the Act and that the said adjustment was made giving the assessee opportunity of being heard. The assessee challenged the action of the CPC in invoking provisions of Section 143(1)(a)(iv) of the Act based on the Audit Report. The Ld. A.R. submitted that the Visakhapatnam Bench of the Tribunal in the case of M/s. S.V. Engineering Constructions India (P) Limited vs. DCIT (ITA No.130/Viz/2021) has categorically held that the issue on account of late payment of employee's contribution to Provident Fund and Employees State Insurance Corporation is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of Zile Singh vs. State of Haryana (2014) 5 SCC 1. The explanations' will be applicable for earlier assessment years as well. The Ld. D.R. further submitted that the contribution made by employees have been deposited after the due date of statutory time limit under the PF Act as well as Employees State Insurance Act. The Ld. D.R. submitted that these statues are beneficial legislation and the due date should be adhered to. As regards various decisions cited by the Ld. A.R., the Ld. D.R. submitted that these decisions are contrary to the decision of the Hon'ble Gujarat High Court in the case of CIT vs. Gujarat State Road Transport Corporation, reported in (2014) 41 taxmann.com 100 (Guj.) holding that employees' contribution to the Emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edited by the assessee to the employee's account in the relevant fund or funds on or before the due date. Prior to Finance Act, 2021 there was no explanation to the word "due date" given and, therefore, the due date was interpreted by various High Courts as being the due date of filing return of income. As the due date was not specified in the earlier occasion, the Finance Act, 2021 has inserted explanation 1 to the Section thereby clarifying that due date means the statutory due date given under the specific Statute. This amendment/insertion is not clarificatory in nature and therefore not retrospective as there is clear mention in the Finance Act that this explanation will come w.e.f. 01.04.2021, thus it will be applicable to A.Y. 2021-22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of AIMIL Ltd. (supra). The Hon'ble Delhi High Court held that the legislative intent is to ensure that the amount paid is allowed as expenditure only when payment is actually made. We do not think that the legislative intent and objective is to treat belated payment of Employee's Provident Fund (EPF) and Employee's State Insurance Scheme (ESI) as deemed income of the employer under Section 2(24)(x) of the Act. It is settled law that when two judgments are available giving different views then the judgment which is in favour of the assessee shall apply as held in case of Vegetable Products Ltd. 82 ITR 192 by the Hon'ble Supreme Court. Hence, in light of the latest decision in case of Pro Interactive Service (India) Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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