Assessee is a company and filed its return of income for A.Y. 2018-19 dated 20.10.2018 declaring total income of Rs.48,72,860/-. In the intimation issued u/s 143(1) of the Act by CPC, Bangalore dated 15.11.2019, the total income was determined at Rs.56,17,360/-. Aggrieved by the intimation issued u/s 143(1) of the Act, assessee carried the matter before CIT(A) who vide order dated 06.09.2021 in Appeal No.CIT(A), Gurgaon1/12075/2019-20 dismissed the appeal of the assessee. Aggrieved by the order of CIT(A), assessee is now in appeal.
The intimation issued u/s 143(1) reveals that addition of Rs.7,32,553/- has been made in the intimation issued by CPC, Bangalore u/s 36(1)(va) of the Act for the reason that the contribution received towards PF/ESIC by the assessee from its employees was not deposited before the due date. Before CIT(A), it was inter alia submitted that though there has been delay in deposit of PF/ESIC Contributions but all the contributions received by the assessee from its employees have been deposited with the appropriate authorities before the filing of return of income by the assessee. Before CIT(A), it was further submitted that since the amounts have been deposited before the filing of return of income, no disallowance is called for and for aforesaid proposition, various decisions of Delhi High Court were relied upon. CIT(A) did not agree with the contentions of the assessee. He upheld the order of AO. Aggrieved by the order of CIT(A), assessee is now in appeal.
As far as reliance by Learned DR on the amendment brought out by Finance Act 2021 is concerned, “notes on clauses” to the Finance Bill 2021 clearly states that the amendment will take effect from 1st April 2021 and will apply in relation to the assessment year 2021-22 and subsequent assessment year. In such a situation, we are of the view that the amendment brought out by Finance Act 2021 does not apply to the assessment year under consideration.
Before the tribunal, Revenue has not placed any material on record to demonstrate that the decision of Hon’ble Delhi High Court cited hereinabove has been overruled/stayed/set aside by higher judicial forum. In view of the aforesaid facts, the tribunal is of the view that the AO was not justified in denying the deduction claimed by the assessee on account of late deposit of PF/ESI/EPF, albeit before filing the return of income. Admittedly in the matter, the Revenue had not contended that the assessee has deposited the contribution after the filing of the return of income. In view of the above, respectfully following the decision of the Hon’ble High Court cited hereinabove, the tribunal allow the ground raised by the assessee and direct the AO to delete the addition.
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