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Income Tax Appellate Tribunal, MUMBAI BENCH “ A”, MUMBAI
Before: SHRI VIKAS AWASTHY & SHRI S.RIFAUR RAHMAN
आयकर अपील�य अ�धकरण मुंबई पीठ “ए ” �ी �वकास अव�थी, �या�यक सद�य एवं �ी एस. �रफौर रहमान, लेखा सद�य के सम� IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “ A”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI S.RIFAUR RAHMAN , ACCOUNTANT MEMBER आअसं.1675/मुं/2021 (�न.व. 2018-19) (A.Y.2018-19) Aevitas Pharmagro Tech Private Limited, B2-210, Boomerang, Chandivali Farm Road, Andheri East, Mumbai 400 072. PAN: AAACP-6240-J ...... अपीलाथ� /Appellant बनाम Vs. Dy. Commissioner of Income Tax(CPC) Bengaluru -560 500. ..... ��तवाद�/Respondent अपीलाथ� �वारा/ Appellant by : Shri Milan Dattani ��तवाद� �वारा/Respondent by : Shri Mehul Jain सुनवाई क� �त�थ/ Date of hearing : 10/05/2022 घोषणा क� �त�थ/ Date of pronouncement : 10/05/2022 आदेश/ ORDER PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax(Appeals), National Faceless Appeal Centre, Delhi [in short 'the CIT(A) ’] dated 30/07/2021, for the assessment year 2018-19.
Shri Milan Dattani appearing on behalf of the assessee submitted that the solitary issue in the present appeal is disallowance of Employees contribution to Provident Fund and ESIC paid after the due date as specified under the relevant Acts but paid before due date for furnishing return of income under section 139(1) of the Income Tax Act, 1961[ in short ‘the Act’]. The ld.Authorized Representative for the assessee submitted that the Central Processing Centre (CPC), Bengaluru vide intimation u/s. 143(1) of the Act dated 01/10/2019 disallowed aforesaid contributions u/s. 43B of the Act. The CIT(A) following the decision of Hon'ble Gujarat High Court in the case of Checkmate Facility and Electronic Solutions Pvt. Ltd. vs. DCIT disallowed assessee’s claim u/s. 36(1)(va) of the Act. The CIT(A) further held that amendment to section 36(1)(va) and section 43B by the Finance Act, 2021 would be effective retrospectively. The ld.Authorized Representative for the assessee vehemently submitted that the CIT(A) failed to follow the decision of Hon'ble Jurisdictional High Court in the case of Hindustan Organic Chemical Ltd., 366 ITR1(Bom) and CIT vs. Ghatge Patil Transport Ltd., 368 ITR 749(Bom). As regards retrospective applicability of amendment he placed reliance on the decision in the case of Adayar Ananda Bhavan Sweets India Pvt. Ltd. vs. ACIT 143 taxmann.com 56.
Per contra Shri Mehul Jain representing the Department vehemently defended the impugned order. The ld. Departmental Representative submitted that provisions of section 36(1)(va) of the Act has been amended by the Finance Act,2021. In the amendment the phrase “ shall be deemed never to have been applied” has been inserted to section 36(1)(va) and section 43B of the Act. This clearly shows that the amendment is retrospective. To support his contention ld. Departmental Representative placed reliance on the decision in the case of CIT vs. Gold Coin Food Processing Pvt. 172 Taxman 386(SC).
Both sides heard orders of authorities below examined and the decisions on which rival sides have place reliance considered. The solitary issue in the present appeal is whether employees contribution towards Provident Fund and ESIC made by the assessee after due date as specified under the relevant Acts but before filing of return would enable the assessee to claim deduction on such contributions under section 36(1)(va) of the Act.
The contention of Revenue is that by virtue of amendment to section 36(1)(va) and section 43B of the Act by Finance Act, 2021 the deduction is not allowable as the amendment is retrospective in application. We find that Chennai Bench of the Tribunal in the case of Adayar Ananda Bhavan Sweets India Pvt. Ltd. vs. ACIT(Supra) has considered the issue of retrospective applicability of amendment to the provisions of section 36(1)(va) of the Act by way of insertion of Explanation – 2 and also the amendment to section 43B of the Act by the Finance Act, 2021. The Co-ordinate Bench of Tribunal after considering various decisions held that the amendment to section 36(1)(va) of the Act and section 43B is prospective and would be effectively applicable from assessment year 2021-22. Similar view has been expressed by various Benches of the Tribunal. Some of the decisions holding aforesaid amendment prospeptive effect from assessment year 2021-22 are as under:
(i) Yogi Ji Technoequip (P.) Ltd. v. Dy. CIT, 129 taxmann.com 313 (Delhi - Trib.) (ii) Mohangarh Engineers and Construction Company v. Deputy Commissioner of Income-tax, 133 taxmann.com 172 (Jodh. -Trib.) (iii) Salzgitter Hydraulics (P.) Ltd. v. Income-Tax Officer, 128 taxmann.com 192 (Hyd.- Trib.) (iv) Bizviz Technologies Ltd. v. Deputy Commissioner of Income-tax, 134 taxmann.com 350 (Bang. - Trib.) (v) Flying Fabrication v. Deputy Commissioner of Income-tax[2021] 133 taxmann.com 84 (Delhi - Trib.) (vi)Eskay Heat Transfers (P.) Ltd. v. Assistant Director of Income –tax(2022) 134 taxmann.com 289 (Bang.Trib) (vii) Bromide Chemical Industries v. Deputy Commissioner of Income-tax, 135 taxmann.com 79 (Jabalpur- Trib.) (viii) Vidhi Clothing Company v. Deputy Commissioner of Income-tax, 135 taxmann.com 327 (Bang- Trib.)
(ix) Megneil Tech (P.) Ltd. v. Commissioner of Income-tax, 135 taxmann.com 75 (Bang. - Trib.) (x) Raj Kumar v. ITD, CPC, Bengaluru, 136 taxmann.com 244 [Del-Trib]
Since, the amendment to section 36(1)(va) and section 43B of the Act by the Finance Act, 2021 has been held to be prospective effect for assessment year 2021-22, ergo, the decision rendered by Hon'ble Bombay High Court in the case of CIT vs. Ghatge Patil Transport Ltd.(supra) would apply in the assessment year under appeal. Consequently, the contribution made by assessee towards ESI and Provident Fund beyond the due date as specified in the relevant Act but before due date for filing return of income u/s 139(1) of the Act would be allowable as deduction u/s. 36(1)(va) of the Act.
In the result, impugned order is set-aside and appeal by the assessee is allowed.
Order pronounced in the open court on Tuesday the 10th day of May, 2022.