Case Number: ITA 1225/DEL/2021
Appellant: Transzone Logistics (India) Private Limited, New Delhi
Respondent: ADIT, CPC, Bangalore
Assessment Year: 2019-20
Case Filed on: 2021-09-27
Order Type: Final Tribunal Order
Date of Order: 2022-02-28
Pronounced on: 2022-02-28
In the case of Transzone Logistics (India) Private Limited vs. Assistant Director of Income Tax, CPC, Bangalore, the appellant challenged the disallowance of employee contributions towards ESI and PF under Section 36(1)(va) of the Income Tax Act, 1961, for the assessment year 2019-20. The disallowance was made by the CPC, Bengaluru, on the grounds that the contributions were deposited after the due dates specified under the respective Acts, but before the due date for filing the income tax return under Section 139(1).
Transzone Logistics (India) Private Limited raised several grounds of appeal, contending that the disallowances were unwarranted as the contributions were made before the due date for filing the income tax return under Section 139(1). The appellant argued that:
The case was heard by the Delhi Bench ‘G’ of the Income Tax Appellate Tribunal, presided over by Shri Saktijit Dey, Judicial Member, and Dr. B. R. R. Kumar, Accountant Member, through video conferencing. The Tribunal noted that the appellant had deposited the employee contributions to PF and ESI before the due date for filing the return under Section 139(1) of the Act, although the payments were made after the due dates specified in the relevant Acts.
The Tribunal relied on several judicial precedents to support the appellant’s position, including:
The Tribunal emphasized that the amendments made to Sections 36(1)(va) and 43B by the Finance Act 2021 should be construed as prospective, applicable from 01.04.2021, and not retrospectively. Since the contributions were deposited before the due date for filing the return, the Tribunal ruled that the disallowances were not justified.
The Tribunal concluded that the CIT(A) was not justified in sustaining the disallowance made by the CPC. Therefore, the appeal of Transzone Logistics (India) Private Limited was allowed, and the Assessing Officer was directed to delete the disallowance.
Order pronounced in the open court on 28/02/2022.
Signed by:
(Saktijit Dey)
Judicial Member
(Dr. B. R. R. Kumar)
Accountant Member
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