ITAT upheld deletion of disallowance of contribution made by assessee
ITAT upheld deletion of disallowance of contribution made by assessee
M/s Rochi Ram and Sons filed return of income declaring income of Rs. 38,81,914. AO noticed PF and ESI contribution were deposited by assessee after due date. AO u/s 43B r.w s 36(1)(va) disallowed the contribution made by assessee and made addition. CIT(A) deleted addition. ITAT upheld CIT(A)’s order.-500604
1. M/s Rochi Ram and Sons filed return of income declaring income of Rs. 38,81,914.
2. The case was selected for scrutiny and notice u/s 143(2) was issued.
3. AO noticed PF and ESI contribution were deposited by assessee after due date.
4. AO u/s 43B r.w s 36(1)(va) disallowed the contribution made by the assessee and added the sum of Rs. 1,63,123 to total income of assessee.
5. AO also made disallowance of Rs. 16,82,406 on account of dead material stock.
7. CIT(A) deleted the addition and disallowance made by the AO.
On appeal, the ITAT held as under:
8. We do not find any reason to disagree with the order passed by ld. CIT (A).
9. Therefore, we uphold the order of ld. CIT(A) in this regard whereby he had deleted the addition of Rs. 1,63,123/- on account of delay in depositing the ESI and PF.
10. The profit or loss of the business are required to be assessed to tax on the basis of real profit and the same is required to be derived after applying the commercially acceptable accounting principle.
11. The valuation of the dead raw material stock was Nil.
12. The judgment referred by the ld. CIT (A) in his order of Hon'ble Supreme Court in the case of Kedarnath Manufacturing Co. vs. CIT (1971) 82 ITR 363 (SC), in our view is squarely applicable.
13. In view thereof, the second ground of the Revenue is also dismissed.
Case Reference - The Income Tax Officer vs M/s. Rochi Ram and Sons.
IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR
BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR,
ITA No. 200/JP/2013
(Assessment Years : 2008-09)
