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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI D.S. SUNDER SINGH
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER:
This appeal of the revenue is directed against the order of the CIT(A) - 15, Chennai dated 19.01.2016 and pertains to assessment year 2011-12.
There is a delay of 10 days in filing the appeal before the Tribunal.
After hearing both the parties, this Tribunal is of the considered opinion that there was a reasonable cause for not filing the appeal before the time prescribed. Accordingly, the delay of 10 days condoned and appeal is admitted.
The only issue arises for consideration is disallowance of employees contribution to provident fund. Shri Shiva Srinivas, the learned department representative submitted that the assessing officer disallowed the contribution of the employees towards employees state insurance and provident fund to the extent of Rs.1,57,55,042/- on the ground that the same was not paid within the due date provided under the Provident Fund Act and Employees State Insurance Corporation Act. The CIT(A) however, directed the assessing officer to allow the claim of the assessee in case the payments were made within the grace period granted under the respective enactment. According to the learned representative when the assessee recovers employees contribution from the respective employees it is expected to pay the same to the respective authorities immediately within the period provided under the respective enactment. Since the assessee has not paid the amount, the assessing officer has rightly disallowed the claim of the assessee. Therefore, the CIT(A) is not justified in allowing the claim of the assessee. We heard ShriK.G.Raghunath, the learned counsel for the assessee also. According to the learned counsel, the payment was made within the due date provided under Section 139(1) of the Act for filing of the return of income. Therefore, the CIT(A) has rightly allowed the claim of the assessee.
We have considered the rival submissions on either side and also perused the material available on record. It is not in dispute that the payment towards employees’ contribution to Employees State Insurance and Provident fund was made by the assesee within the due date for filing the return of income under Section 139(1). The only objection of the department representative is that the payment was not made within the due date provided under the Employees State Insurance Corporation Act and Provident Fund Act.
The grace period granted under the relevant provisions of the respective act cannot be ignored at all. This Tribunal is of the considered opinion that the Income Tax Act is a special enactment for the computation of assessable income. Section 43B of the Income Tax Act provides for deduction of certain amount on actual payment only. The Madras High Court in Industrial Security & Intelligence India Pvt. Ltd. in TC(Appeal) Nos.585 & 586 of 2015 dated 24.7.2015 allowed the similar claim in case the same was paid within the due date for filing of the return of income under Section 139(1) of the Act. In view of this judgment of Madras High Court, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly, the same is confirmed.
In the result, the appeal of the revenue stands dismissed.
Order pronounced on 28th October, 2016 at Chennai.