THE PARBHANI DISTRICT CENTRAL CO-OP. BANK LTD. vs. ASSISTANT COMMISSIONER OF INCOME-TAX,

आदेश / ORDER

PER ANIL CHATURVEDI, AM :

as under :-

Assessee is a Co-operative Society stated to be engaged in the

business of banking. Assessee electronically filed its return of income

for A.Y. 2012-13 on 18.05.2013 declaring total income of

Rs.15,82,95,334/-. The case was selected for scrutiny and thereafter

assessment was framed u/s 143(3) of the Act vide order dt.05.03.2015

and the total income was determined at Rs.16,95,48,030/-. Aggrieved

by the order of AO, assessee carried the matter before Ld.CIT(A), who

vide order dt.31.08.2016 (in appeal No.ABD/CIT(A)-1/72/2015-2016)

granted substantial relief to the assessee. Aggrieved by the order of

Ld.CIT(A), assessee and Revenue are now in appeal before us.

No.2499/PUN/2016 for A.Y. 2012-13 reads as under :

“ The learned Commissioner of Income Tax (Appeals) -1, Aurangabad has erred in facts and on law by confirming the addition of Rs.13,45,843/- u/s 36(1)(va). Hence, the said addition of Rs.13,45,843/- needs to be deleted.”

No.2567/PUN/2016 read as under :

“1. Whether on facts and circumstances of the case, the Ld.CIT(A)-1, was right in holding that the interest paid by the assessee bank did not partake the nature and character of interest, as contemplated in section 194A, r.w.s. 2(28) of the Act.

No.2499/PUN/2016 for A.Y. 2012-13.

assessee had failed to deposit the Employees contribution of Provident

Fund within the due date prescribed by the Act. He noticed that

amount of Rs.13,45,843/- was deposited on 27.04.2012 which was

after the due date prescribed under the P.F. Act. He was of the view

that the delayed payment of Employees contribution of P.F. was not

allowable u/s 43B of the Act and he accordingly made its addition.

Aggrieved by the order of AO, assessee carried the matter before

Ld.CIT(A), who following the order of Hon’ble Gujarat High Court in the

case of Gujarat State Road Transport Corporation reported in (41

taxmann.com 100) and the decision of Hon’ble Kerala High Court in the

case of CIT Vs. Merchem Ltd. reported in (378 ITR 443) upheld the

order of AO by holding that the amount is allowable only if the amount

is deposited before the due date prescribed under the P.F. Act.

Aggrieved by the order of Ld.CIT(A), assessee is now before us.

and Ld.CIT(A) and further submitted that though there was delay in

depositing employees share of P.F. Contribution but the same was

deposited on 27.04.2012 much before the date of filing of return of

income which was filed on 18.05.2013. He therefore relying on the

decision of Hon’ble Bombay High Court in the case of CIT Vs. Ghatge

Patil Transports Ltd. reported in (2014) 368 ITR 749 submitted that the

addition made by the AO and upheld by the Ld.CIT(A) be deleted. Ld.

D.R. on the other hand, supported the order of lower authorities.

record. The issue in the present ground is with respect to delayed

deposit of Employee contribution of Provident Fund. It is an

undisputed fact that the amount of Employee contribution of P.F. was

deposited after the due date as prescribed under the P.F. Act but

however it was deposited before the due date of filing of return. We find

that Hon’ble Bombay High Court in the case of CIT Vs. Ghatge Patil

Transports Ltd. (supra) after relying on the decision of Hon’ble Apex

Court in the case of Alom Extrusions Ltd., reported in (2009) 319 ITR

306 (SC) has held that no disallowance is called for when the assessee

has deposited the Employee PF contribution before the due date of

filing of return of income. In view of the aforesaid facts and relying on

the decision of Hon’ble Bombay High Court in the case of CIT Vs.

Ghatge Patil Transports Ltd., (supra), we hold that in the present case

since the Employee contribution of PF has been deposited before the

due date of filing of return of income, no addition is called for and

therefore direct its deletion. Thus, the ground of the assessee is

allowed.

No.2499/PUN/2016 for A.Y. 2012-13 is allowed.

A.Y. 2012-13.

the Profit & Loss account, AO noticed that assessee had claimed

interest expenses of Rs.65,42,033/- on account of “interest on gratuity

payment”. The assessee was asked to explain its allowability and

whether the TDS was deducted on such payments. To the query of the

AO, assessee inter-alia submitted that due to the financial position of

the Bank, 50% of the gratuity was paid in earlier year and as per the

Court’s order, the payment of gratuity was made along with interest. It

was further submitted that no TDS was deducted as the payment of

gratuity was not covered u/s 194A of the Act. The submissions of the

assessee were not found acceptable to the AO as the AO was of the view

that assessee was required to deduct TDS on the delayed payment of

interest. He therefore held that since the assessee has failed to deduct

the TDS, the interest of Rs.65,42,033/- claimed by the assessee is not

allowable as deduction. He accordingly made its addition. Aggrieved

by the order of AO, assessee carried the matter before Ld.CIT(A), who

decided the issue in favour of the assessee.

Aggrieved by the order of Ld.CIT(A), Revenue is now in appeal

before us.

other hand reiterated the submissions made before AO and Ld.CIT(A)

and supported the order of Ld.CIT(A).

record. We find that Ld.CIT(A) while deciding the issue in favour of

assessee has given a finding that the payment of interest to employees

for delayed payment contribution was in the nature of compensation /

damages and the interest would not partake the nature and character

of interest as contemplated u/s 194A r.w. Sec.2(28A) of the Act and

accordingly assessee was not required to deduct TDS on such interest

on delayed payment of gratuity. While arriving at the aforesaid

conclusion, Ld.CIT(A) has also relied on various decisions rendered by

the Hon’ble High Courts in the order. He thereafter deleted the addition made by the AO. Before us, Revenue has not pointed out any

fallacy in the findings of Ld.CIT(A). We therefore find no reason to

interfere with the order of Ld.CIT(A). Thus, the grounds of Revenue are

dismissed.

No.2567/PUN/2016 for A.Y. 2012-13 is dismissed.

of Revenue is dismissed.

Order pronounced on 17th day of July, 2019.

Sd/- Sd/- (SUSHMA CHOWLA) (ANIL CHATURVEDI) �या�यक सद�य / JUDICIAL MEMBER लेखा सद�य / ACCOUNTANT MEMBER

पुणे Pune; �दनांक Dated : 17th July, 2019. Yamini

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent 3. CIT(A)-1, Aurangabad. 4. PCIT – 1, Aurangabad. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “बी” / DR, 5. ITAT, “B” Pune; 6. गाड� फाईल / Guard file.

आदेशानुसार/ BY ORDER,स

�या // True Copy // व�र�ठ �नजी स�चव / Sr. Private Secretary आयकर अपील�य अ�धकरण ,पुणे / ITAT, Pune