M/S M.V.S. ENGINEERING LTD. vs. THE COMM. OF INCOME TAX

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ITA/603/2004HC DelhiDLHC01017076200424 April 2017Bench: HON'BLE DR. JUSTICE S.MURALIDHAR,HON'BLE MR. JUSTICE CHANDER SHEKHAR2 pages
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What did the High Court hold?

The High Court of Delhi held that the Income Tax Appellate Tribunal had not correctly interpreted the provisions of Section 43B and its second proviso. The Court found that the issue raised in the appeal had already been decided in favour of the Assessee and against the Revenue by the Court's own prior decision in Commissioner of Income-tax v. AIMIL Limited (2010) 321 ITR 508 (Del). Consequently, the impugned order of the ITAT was set aside, and the question of law framed by the Court was answered in favour of the Assessee and against the Revenue. The appeal was allowed, with no orders as to costs.

What were the facts?

The appeal, filed by M.V.S. Engineering Limited (the Assessee) under Section 260A of the Income Tax Act, 1961, challenges an order dated 5th March, 2004, passed by the Income Tax Appellate Tribunal (ITAT) for the Assessment Year 1996-97. The High Court of Delhi admitted the appeal on 2nd November, 2004, and framed a specific question of law. The dispute revolves around the deductibility of employee contributions to provident fund and ESI under Section 43B of the Act, specifically whether these amounts had to be deposited each month before the due dates prescribed by the respective welfare acts.

What were the issues?

1. Whether the Income Tax Appellate Tribunal correctly interpreted Section 43B and its second proviso to hold that the Assessee had to deposit employee contributions under the Employees Provident Fund and Misc. Provision Act, 1952, and the Employees State Insurance Act, 1948, each month before the due dates prescribed under these Acts to qualify for deduction under Section 43B of the Income Tax Act, 1961? Assessee's contentions: Not recorded in the judgment. Revenue's contentions: Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 43B,Section 260A

AI-generated summary — verify with the full judgment below

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI R-9 +

ITA 603/2004

M.V.S. ENGINEERING LTD

..... Appellant

Through: None.

Versus

THE COMMISSIONER OF INCOME TAX ..... Respondent Through: Mr. Dileep Shivpuri, Senior standing counsel.

CORAM: JUSTICE S.MURALIDHAR JUSTICE CHANDER SHEKHAR

O R D E R %

24.04.2017

1.

This appeal under Section 260A of the Income Tax Act, 1961 („Act‟) filed by the Appellant, M.V.S. Engineering Limited, is directed against the impugned order dated 5th March, 2004 passed by the Income Tax Appellate Tribunal („ITAT‟) for the Assessment Year („AY”) 1996-97.

2.

By an order dated 2nd November, 2004, while admitting the appeal, the Court framed the following question of law for consideration: “Whether the Income Tax Appellate Tribunal has correctly interpreted the provisions of Section 43B and 2nd proviso thereto, to hold that the Assessee had to deposit the employees contribution under the Employees Provident Fund and Misc. Provision Act, 1952 and the Employees State Insurance Act, 1948, each month before the due

ITA 603/2004

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dates as prescribed under these Welfare Acts to get the benefit of deduction under Section 43B of the income Tax Act, 1961?”

3.

It is seen that the aforesaid question stands answered in favour of the Assessee and against the Revenue by the decision of this Court in Commissioner of Income-tax v. AIMIL Limited (2010) 321 ITR 508 (Del).

4.

Accordingly, the impugned order of the ITAT is set aside and the question framed is answered in favour of the Assessee and against the Revenue. The appeal is allowed but in the facts and circumstances of the case, with no orders as to costs.

S.MURALIDHAR, J

CHANDER SHEKHAR, J APRIL 24, 2017 Rm

ITA 603/2004

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