D.D.BUILDERS LIMITED,BHUBANESWAR vs. ACIT,CENTRAL CIRCLE-2, BHUBANESWAR

It was submitted by the ld. AR of the assessee that the only issue in this appeal was against the action of the ld. CIT(A) in confirming the disallowance of PF & ESI paid by the assessee beyond the due date as prescribed under the respective Acts but before the due date of filing of the return. Ld. AR placed before us a decision of the coordinate bench of the Tribunal in the case of Odyssey Motors Pvt. Ltd., in order dated 17.08.2022, wherein the coordinate bench of the Tribunal has held that if the assessee pays PF & ESI before the due date of filing the return even though the same was beyond the due date as prescribed under the respective Acts, the same is allowable. To support his arguments, ld. AR of the assessee also relied on the following case laws :- i) M/s Essae Teraoka Pvt. Ltd. Vs. DCIT [2014 (3) TMI 386-Kar HC]; ii) CIT Vs. State Bank of Bikaner & Jaipur & Jaipur Vidyut Vitaran Nigam Ltd. [2014(5) TMI 222-Raj HC) dated Jan, 6, 2014; and iii) CIT Vs. M/s Kichha Sugar Company ltd. [2013 (6) TMi 98- Uttarakhand HC. iv) Jagmohan Singh Vs DCIT (ITAT Chandigarh), Appeal Number: ITA Nos. 185 & 193/Chd/2021, Date of Judgement/Order: 15/12/2021 v) Stirred Creative Advertising Pvt. Ltd. Vs DCIT (ITAT Bangalore), Appeal Number : ITA No. 594 & 595/Bang/2021, Date of Judgement/Order : 12/12/2021 vi) Adyar Ananda Bhavan Sweets India P Ltd Vs ACIT (ITAT Chennai), Appeal Number : ITA [2015 – 5/23 402 & 403/CHNY/2021, Date of Judgement/Order : 08/12/2021 vii) Pachouli Wellness Clinic LLP Vs ITO (ITAT Delhi), Appeal Number : ITA No: 999/Del/2021, Date of Judgement/Order : 25/11/2021 viii) Star Facilities Management Limited VS ITO (ITAT Delhi), Appeal Number : ITA No. 1755/Del/2020, Date of Judgement/Order : 01/11/2021 ix) Lumino Industries Ltd. Vs. ACIT, ITA Nos.231&365/Kol/2021, order dated 17/11/2021; x) Mavinahalli Shivananjappa Vijay Kumar Vs. DCIT, ITA Nos.596&597/Bang/2021, order dated 13/12/2021; xi) Shri Prakash Pai Kochikar Vs. ADIT, ITA No.479/Bang/2021, order dated 09/12/2021; xii) Eskay heat Transfers Pvt. Ltd. Vs. ADIT, ITA No.534/Bang/2021, order dated 07/12/2021; xiii) Anand Sweets and Savouries Vs. DCIT, ITA No.530/Bang/2021, order dated 06/12/2021; xiv) Transzone Logistics (India) Pvt. Ltd. Vs. DCIT, ITA No.1740/Del/2020, order dated 29/10/2021; xv) Jai Enterprises Vs. DCIT, ITA No.248/JP/2021, order dated 25/11/2021; xvi) Nayrathan Jewellers Pvt. Ltd. Vs. ADIT, ITA No.470/Bang/2021, order dated 23/11/2021; Abhimanyu Sharma Vs. ITO, order dated 23/11/2021; xviii) Nikhil Mohine Vs. DCIT, ITA No.37&38/Jab/2021, order dated 18/11/2021; xix) DCIT Vs. Kesoram Industries Ltd., ITA No.1777/Kol/2019, order dated 28/10/2021; xx) Suba Singh Vs. ITO, ITA No.85/ASR/2021, order dated 10/11/2021; xxi) Citi Centre Developers Vs. CPC, ITA No.126/Chd/2021, order dated 28/11/2021; xxii) Pee Tee Turners Vs. ADCPC, ITA No.105/JP/2021, order dated 28/11/2021; xxiii) Amandeep Singh Khurana Vs. ITO, ITA No.1822/Del/2020, order dated 27/10/2021; xxiv) Aroon Facilitation Management Services Pvt. Vs. DCIT, ITA No.1824/Del/2020, order dated 13/10/2021; xxv) Worldwide Facility Management Services Pvt. Ltd.Vs. DCIT, ITA No.1823/Del/2020, order dated 13/10/2021; xxvi) Rukmini Polytubes Pvt. Ltd. Vs. DCIT, ITA No.1855/Del/2020, order dated 13/10/2021; xxvii) Adama Solution P. Ltd. Vs. ADIT, ITA No.1800/Del/2020, order dated 13/10/2021; xxviii) Vansh Jain Vs. DCIT, ITA No.1853/Del/2020, order dated 13/10/2021; xxix) Express Roadway P. Ltd. Vs. ACIT, ITA No.5570/Del/2017, order dated 11/10/2021; xxx) Ridhi Sidhi Mills (India) Pvt. Ltd. Vs. DCIT, ITA Nos.71&72/Jodh/2021, order dated 28/09/2021; xxxi) Chodavaram Vs. ADIT, ITA No.25&28/VIZ/2021, order dated 23/09/2021; xxxii) S.V.Engineering Constructions India (P) Ltd. Vs. DCIT, ITA No.130/VIZ/2021, order dated 23/09/2021.

In reply, the ld. CIT-DR submitted that PF & ESI has been paid beyond the due date as prescribed under the respective Acts, even if paid within the due date of filing of the return constituted income u/s.36(1)(va) r.w.s.2(24)(x) of the Act. To support his arguments, ld. CIT-DR relied on the following case laws :- i) Unifac Management Services (India)(P.) Ltd. Vs. DCIT, [2018] 100 taxmann.com 244 (Madras); ii) CIT Vs. Gujarat State Road Transport Corporation [2014] 41 taxmann.com 100 (Gujarat); iii) CIT Vs. Merchem Limited, (2015) 378 ITR 443 (Kerala); Pr.CIT Vs. M/s Suzlon Energy Ltd., (2020) 423 ITR 608 (Guj); v) CIT Vs. Bharat Hotels Ltd., (2019) 410 ITR 0417 (Delhi), vi) Popular Vehicles & Services (P.) Ltd., [2018] 96 taxmann.com 13 (Kerala); vii) South India Corporation Ltd., [2015] 58 taxmann.com 208 (Kerala); viii) Vedvan Consultants Pvt. Ltd., order dated 26.08.2021.

We have considered rival submissions. There are plethora of decisions on this issue for both the sides. However, in view of the decision of the Hon’ble Supreme Court in the case of CIT Vs. Vegetable Products Ltd., reported in [1973] 88 ITR 192 (SC), when we are faced with decisions which are both for and against the assessee, then in the interest of justice, decisions in favour of the assessee should be followed. This coordinate bench of the Tribunal in the case of Odyssey Motors Pvt. Ltd. in ITA No.140/CTK/2021, vide order dated 17.08.2022, has held the issue in favour of the assessee. As the coordinate bench of the Tribunal has been continuously holding this issue in favour of the assessee by following various High Court decisions, respectfully following the principles laid down in the decision of the Hon’ble Supreme Court in the case of Vegetable Products and the decision of the Tribunal in the case of Odyssey Motors Pvt. Ltd. (supra), we decide the issue in favour of the assessee. Consequently, the order of the CIT(A) is set aside and the AO is directed to allow the assessee’s claim of deduction of employees contribution to PF & ESI paid beyond the due date under the respective Act but before the filing of the return.