PR COMMISSIONER OF INCOME TAX JAIPUR-II vs. RAJASTHAN STATE ELECTRICITY BOARD

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ITA/249/2018HC RajasthanRJHC02068763201807 August 2019Bench: MOHAMMAD RAFIQ,NARENDRA SINGH DHADDHA4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Judicature for Rajasthan, Bench at Jaipur, disposed of all the aforesaid appeals. The learned counsel for both the parties agreed that the questions in these appeals pertain to contributions towards Provident Fund and ESI and that these issues had already been decided against the Revenue by the same Court in Commissioner of Income Tax Vs. M/s. State Bank of Bikaner and Jaipur, (2014) 363 ITR 70 (Raj.). However, since the Revenue had filed an SLP before the Supreme Court challenging the correctness of that judgment, and the SLP was pending, the parties jointly submitted that the present appeals should be disposed of making them subject to the final judgment of the Supreme Court in the pending SLP. The Court accepted this submission and disposed of the appeals accordingly, without deciding the merits of the issues themselves, but deferring to the Supreme Court's ultimate decision.

What were the facts?

These are multiple Income Tax Appeals filed by the Principal Commissioner of Income Tax, Jaipur-II, against various Rajasthan state electricity companies (Rajasthan Rajya Vidyut Prasaran Nigam Ltd., Rajasthan Rajya Vidyut Utpadan Nigam Ltd., Rajasthan State Electricity Board, and Jaipur Vidyut Vitran Nigam Ltd.). The appeals are for assessment years not explicitly stated but are related to the period leading up to 2018. The core issue revolves around the deductibility of contributions towards Provident Fund and ESI. The appeals challenge orders or actions by the Income Tax Department. The procedural history indicates that similar issues were decided by the Rajasthan High Court in favor of the assessee in a previous judgment, but the Revenue has filed a Special Leave Petition (SLP) before the Supreme Court, which is pending.

What were the issues?

1. Whether the contribution towards Provident Fund and ESI are allowable as a deduction under the Income Tax Act, 1961, specifically concerning the interpretation of Section 43-B. Assessee's Contention: The assessee's counsel, along with the Revenue's counsel, acknowledged that the Rajasthan High Court had previously decided this issue against the Revenue in the case of Commissioner of Income Tax Vs. M/s. State Bank of Bikaner and Jaipur, (2014) 363 ITR 70 (Raj.). Revenue's Contention: The Revenue's counsel acknowledged the High Court's previous ruling but highlighted that the correctness of that judgment is currently under scrutiny by the Supreme Court, as an SLP (C) No. 016249/2014 has been filed and is pending. Therefore, the Revenue argued that these appeals should be disposed of subject to the final outcome of the pending SLP.

Which sections of the Income-tax Act were involved?

Section 43-B

AI-generated summary — verify with the full judgment below

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 239/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Ncr Building Statue Circle C-Scheme Jaipur ----Appellant Versus M/s Rajasthan Rajya Vidyut Prasaran Nigam Ltd, Vidyut Bhawan Jaipur ----Respondent Connected With D.B. Income Tax Appeal No. 232/2018 Pr Commissioner Of Income Tax, Jaipur-Ii, Jaipur ----Appellant Versus Rajasthan Rajya Vidyut Utpadan Nigam Ltd, Vidyut Bhawan, Janpath Marg, Jyoti Nagar, Jaipur ----Respondent D.B. Income Tax Appeal No. 233/2018 Pr Commissioner Of Income Tax, Jaipur-Ii, Jaipur ----Appellant Versus Rajasthan Rajya Vidyut Utpadan Nigam Ltd, Vidyut Bhawan, Janpath Marg, Jyoti Nagar, Jaipur ----Respondent D.B. Income Tax Appeal No. 240/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Ncr Building, Statue Circle, C-Scheme Jaipur ----Appellant Versus M/s Rajasthan Rajya Vidyut Prasaran Nigam Ltd, Vidyut Bhawan, Jaipur ----Respondent D.B. Income Tax Appeal No. 243/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Jaipur, Ncr Building, Statue Circle, C-Scheme, Jaipur

(2 of 4) [ITA-239/2018] ----Appellant Versus M/s Rajasthan Rajya Vidyut Prasaran Nigam Ltd, Vidyut Bhawan, Jaipur ----Respondent D.B. Income Tax Appeal No. 247/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Ncr Building Statue Circle C-Scheme Jaipur ----Appellant Versus M/s Rajasthan Rajya Vidyut Prsaran Nigam Ltd, Vidyut Bhawan Jaipur ----Respondent D.B. Income Tax Appeal No. 249/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Jaipur ----Appellant Versus Rajasthan State Electricity Board, Vidyut Bhawan, Jyoti Nagar, Jaipur ----Respondent D.B. Income Tax Appeal No. 250/2018 Pr Commissioner Of Income Tax Jaipur-Ii, Jaipur - Ii Jaipur ----Appellant Versus Rajasthan Rajya Vidyut Utpadan Nigam Ltd, Vidyut Bhawan Janpath Marg Jyoti Nagar Jaipur ----Respondent D.B. Income Tax Appeal No. 275/2018 Pr. Commissioner Of Income Tax, Jaipur-Ii, Jaipur ----Appellant Versus Rajasthan Rajya Vidyut Utpadan Nigam Ltd., Jyoti Nagar, Jaipur ----Respondent D.B. Income Tax Appeal No. 276/2018 Pr. Commissioner Of Income Tax Jaipur-Ii, Jaipur Ncr Building Statue Circle C-Scheme Jaipur

(3 of 4) [ITA-239/2018] ----Appellant Versus M/s Rajasthan Rajya Vidyut Prasaran Nigam Ltd., Vidyut Bhawan Jaipur ----Respondent D.B. Income Tax Appeal No. 284/2018 Pr. Commissioner Of Income Tax, Jaipur-Ii, Jaipur. ----Appellant Versus M/s Jaipur Vidyut Vitran Nigam Ltd., Vidyut Bhawan, Janpath, Jaipur. Pan- Aabcj6373K ----Respondent For Appellant(s) : Mr. Sameer Jain with Mr. Arjun Singh. Mr. Prateek Kedawat on behalf of Mr. R.B. Mathur. For Respondent(s) : Mr. Atul Saxena on behalf of Mr. Sanjay Jhanwar Mr. L.L. Gupta. HON'BLE MR. JUSTICE MOHAMMAD RAFIQ HON'BLE MR. JUSTICE NARENDRA SINGH DHADDHA Judgment 07/08/2019 Learned counsel for the parties are at idom that the questions that are proposed in these appeals pertain to contribution towards Provident Fund and ESI and the said issues have already been decided against the Revenue by this Court vide judgment dated 06.01.2014 passed in Commissioner of Income Tax Vs. M/s. State Bank of Bikaner and Jaipur, (2014) 363 ITR 70 (Raj.). However, the Revenue has preferred SLP (C) No. 016249/2014 against the aforesaid judgment before the Supreme Court. Learned counsel submit that although this Court has answered the question with respect to interpretation of Section

(4 of 4) [ITA-239/2018] 43-B of the Income Tax Act against the Revenue but correctness of that judgment is to be tested by the Supreme Court in the aforesaid pending SLP. Therefore, these appeals may be disposed of making them subject to the final judgment of the Supreme Court on the aforesaid question in pending SLP. In view of above, all the aforesaid appeals are disposed of accordingly. All the pending applications also stand disposed of. Office is directed to place a copy of this judgment on record of each connected appeal. (NARENDRA SINGH DHADDHA),J (MOHAMMAD RAFIQ),J MANOJ NARWANI /29 to 34, 36 to 40.

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