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Income Tax Appellate Tribunal, PUNE BENCH, ‘B’ PUNE
Before: SHRI R.S. SYAL & SHRI S.S. VISWANETHRA RAVI
आदेश / ORDER
PER R.S. SYAL, VP : These two appeals by the assessee are directed against the orders dated 12-03-2021 passed by the National Faceless Appeal Centre (NFAC), Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment years 2018-19 and 2019-20. These appeals involve a solitary issue of the confirmation of disallowance u/s.36(1)(va) of Act.
2 ITA Nos.287 & 288/PUN/2021 Pratik Tukaram Suryawanshi
For the sake of convenience, we proceed to dispose them off by
this consolidated order.
These appeals are time barred by 52 days. The assessee
has filed condonation application stating the reasons for the delay,
being, the lock down declared by the Govt. of Maharashtra owing
to Covid-19 pandemic. Under such circumstances, the delay is
condoned by virtue of the judgment of the Hon’ble Supreme
Court in Cognizance for Extension of Limitation, In re 438 ITR
296 (SC) read with judgment in Cognizance for Extension of
Limitation, In re 432 ITR 206 (SC) dated 08-03-2021 and 421
ITR 314. The instant appeals are, ergo, admitted for disposal on
merits.
Briefly stated, the facts for the A.Y. 2018-19 are that the
Assessing Officer (AO) made disallowance of Rs.11,03,787/- in
the intimation u/s.143(1) of the Act on the ground that the
assessee late deposited the employees’ share of EPF/ESI. The
facts for the A.Y. 2019-20 are mutatis mutandis similar. For this
year also, the AO made disallowance of Rs.7,38,547/-
u/s.36(1)(va) of the Act in the intimation u/s.143(1) of the Act.
The ld. CIT(A) sustained the disallowances. Aggrieved thereby,
3 ITA Nos.287 & 288/PUN/2021 Pratik Tukaram Suryawanshi
the assessee has come up in appeal before the Tribunal for the two
assessment years under consideration.
We have heard the assessee, who appeared in person and the
learned DR; and also gone through the relevant material on
record. It is an admitted position that the assessee did deduct EPF
and ESI from the employees’ share but deposited the same with
exchequer a little bit late on some occasions after the due date
under the respective legislations but before the time stipulated for
filing returns u/s 139(1) of the Act for both the years. In our
opinion, this issue is no more res integra in view of several
judgments allowing deduction u/s 36(1)(va) of employees’ share
of contribution deposited after due date under the respective Acts
but before the date prescribed u/s 139 of the Act. The Hon’ble
Himachal Pradesh High Court in CIT vs. Nipso Polyfabriks Ltd.
(2013) 350 ITR 327 (HP) has held that there exists no difference
between employees or employer’s contribution and both are to be
allowed as deduction if deposited before the due date.
At this juncture, it is relevant to mention that the Finance Act,
2021 has inserted Explanation 2 below section 36(1)(va)
providing that the provisions of section 43B shall not apply for
4 ITA Nos.287 & 288/PUN/2021 Pratik Tukaram Suryawanshi
the purpose of determining the due date under this clause w.e.f.
01.04.2021. The effect of this amendment is that if the amount of
employees’ contribution towards EPF, ESI, etc is delayed by an
employer beyond the due date under the respective Acts, the
disallowance will be called for notwithstanding the fact that it was
deposited before the due date u/s 139 of the Act. The
Memorandum explaining the provisions of the Finance Bill, 2021, provides that this amendment will take effect from 1st April, 2021
and will, accordingly apply in relation to assessment year 2021-
2022 and subsequent assessment years. Since the assessment
years under consideration, namely, 2018-19 and 2019-20 are
anterior to the amendment carried out with effect from A.Y.
2021-22, we hold that the position of law as set out by various
Hon’ble High Courts including the one in CIT vs. Nipso
Polyfabriks Ltd. (supra) squarely applies to the facts and
circumstances of the instant appeals, thereby not warranting any
disallowance since the amounts in question were admittedly
deposited before due date u/s 139(1) of the Act. The additions are,
therefore, directed to be deleted.
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In the result, both the appeals are allowed.
Order pronounced in the Open Court on 20th June, 2022.
Sd/- Sd/- (S.S. VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 20th June, 2022 सतीश आदेश की �ितिलिप अ�ेिषत/Copy of the Order is forwarded to: अपीलाथ� / The Appellant; 1. ��थ� / The Respondent 2. 3. The NFAC, Delhi 4. The CIT concerned 5. DR, ITAT, ‘B’ Bench, Pune गाड� फाईल / Guard file. 6.
आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune
ITA Nos.287 & 288/PUN/2021 Pratik Tukaram Suryawanshi
Date 1. Draft dictated on 20-06-2022 Sr.PS 2. Draft placed before author 20-06-2022 Sr.PS 3. Draft proposed & placed before JM the second member 4. Draft discussed/approved by JM Second Member. 5. Approved Draft comes to the Sr.PS Sr.PS/PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order.
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