DEPUTY COMMISSIONER OF INCOME TAX, JAIPUR vs. RAJASTHAN RAJYA VIDYUT UTPADAN NIGAM LTD., JAIPUR

Regarding Ground Nos. 1 and 2, briefly the facts of the case are that during the course of assessment proceedings, the Assessing Officer observed that the contribution towards CPF, GPF & EPF have not been paid to the credit of Government within the time prescribed under the relevant provisions, accordingly, he disallowed an amount of Rs. 3,53,31,946/- u/s 43B of the Act.

During the course of appellate proceedings, the assessee relied on the decisions of Hon’ble Rajasthan High in case of CIT vs. State Bank of Bikaner & Jaipur 99 DTR 131, CIT vs. Jaipur Vidyut vitran Nigam Ltd. 98 DTR 105 and CIT vs. Udaipur Dugdh Utpadak Sahari Sangh Ltd. 98 DTR 109 and submitted that the assessee has deposited the entire CPF, GPF, EPF and ESI before the due date of filing of the return of income. The ld. CIT(A) has observed that the assessee has deposited the contribution towards CPF, GPF, EPF and ESI before the due date of filing of the income tax return. The ld. CIT(A) further observed that the decisions of the Hon’ble Rajasthan High Court relied upon by the assessee supported its case that if employees contribution towards PF, if paid after the due date under the respective Acts but before filing of return of income U/s 139, the same cannot be disallowed U/s 43B or U/s 36(1)(va) of the Act. Thereafter the ld. CIT(A) referred to the decision of Hon’ble Supreme Court in case of CIT vs. Alom Extrusions Ltd. 319 ITR 306 and directed the AO

During the course of hearing, the ld. DR has submitted that the Department has not accepted the decision of Hon’ble Rajasthan High Court and the same has been challenged before the Hon’ble Supreme Court in case of JVVNL and the issues is currently pending adjudication before the Hon’ble Supreme Court.

Per contra, the ld. AR has reiterated the submissions made before the ld. CIT(A) and submitted that the matter is squarely covered by the decisions of Hon’ble Rajasthan High Court.

We have heard the rival contentions and perused the material available on record and we do not think that there is any infirmity in the order of the ld. CIT(A) following the decisions of the Hon’ble Rajasthan High Court referred supra and in directing the AO to verify the dates of payment of employee’s contribution and delete the same, if the payments have been made before the due date of filing of the return of income. In the result, the grounds taken by the Revenue are dismissed.

Regarding ground No. 3, briefly the facts of the case are that the assessee company has contributed an amount of Rs. 26,24,224/- towards gratuity fund and the same was claimed on payment basis. The Assessing Officer however, disallowed the claim of the assessee on the

During the course of appellate proceedings before the ld. CIT(A), the ld. AR has submitted that the gratuity fund of the assessee company is duly approved and a copy of the approval certificate was filed before the ld. CIT(A). It was submitted that the said gratuity trust is for all the five companies formed as a result of unbundling exercise from the erstwhile RSEB. The ld. CIT(A) has return a finding that the gratuity fund of the assessee company is duly approved and a certificate to this effect has been placed on record. Accordingly, he deleted the disallowance of Rs. 26,24,224/- made by the Assessing Officer.

During the course of hearing both the parties reiterated their respective positions taken before the lower authorities. We have considered the rival contentions and perused the material available on record. We do not see any infirmity in the order of ld. CIT(A) where he has returned a finding that the payment has been made to the approved gratuity trust. During the course of hearing, at the pointed question raised by the Bench, the ld AR submitted that the said gratuity trust though called as M/s Rajasthan Rajya Karmchari Gratuity Trust is for all the five companies formed as a result of unbundling exercise from the erstwhile RSEB and the assessee company has contributed to the said trust in relation to its employees. Hence, the findings of the ld

Regarding ground No. 4, briefly the facts of the case are that during the course of assessment proceedings, the assessee vide its letter dated nil has claimed deduction towards bonus payment of Rs. 57,50,000/- pertaining to the earlier year on payment basis. However, the AO did not allow the same and there is no discussion thereof in the assessment order. During the course of appellate proceedings, the assessee submitted that by mistake, it did not claim the deduction of Rs. 57,50,302/- in the return of income however, the claim was made and necessary details of actual payment of the bonus were submitted during the course of assessment proceedings. The ld CIT(A) returned a finding that since the payment is made during the year, the same is allowable as deduction u/s 43B of the Act on payment basis.

During the course of hearing, both the parties reiterated their respective contentions as made before the lower authorities and after considering the same, we do not see any infirmity in the order of the ld. CIT(A) who has allowed the claim of bonus on payment basis under the provisions of section 43B of the Act. Hence, the ground taken by the Revenue is dismissed.

Regarding ground no. 5, briefly the facts of the case are that the assessee has claimed an amount of Rs. 1,14,85,104/- on account of pension payment during the year in respect of its employees. The AO disallowed the same by observing that the pension/superannuation fund

During the course of hearing both the parties reiterated their respective positions as taken before the lower authorities. We have considered the rival submissions and perused the material available on record and we do not see any infirmity in the order of the ld. CIT(A) in allowing the claim of pension payment to an approved pension fund. Hence, the ground taken by the Revenue is dismissed.

In ITA No. 977/JP/2017 in relation to M/s Rajasthan Rajya Vidyut Prasaran Nigam Ltd., both the parties fairly submitted that facts and circumstances of the case are exactly identical as in ITA No. 972/JP/2017 and similar grounds of appeal have been taken by the Revenue. Given the fact that the facts and circumstances are identical, our findings and directions as contained in ITA No. 972/JP/2017 shall apply mutatis mutandis to this matter as well. In the result, the appeal filed by the Revenue is dismissed.