D.b. Income Tax Appeal v. M/S. Rajasthan State Ganganagar Sugar Mills Ltd., 4Th Floor, Nehru Sahakar Bhawan, Jaipur

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 13 / 2017Principal Commissioner of Income Tax, Jaipur-2, Jaipur. ----Appellant Versus M/s. Rajasthan State Ganganagar Sugar Mills Ltd., 4th Floor, Nehru Sahakar Bhawan, Jaipur. PAN - ----Respondent _____________________________________________________ For Appellant(s) : Mr. R.B. Mathur _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VINIT KUMAR MATHURJudgment 17/01/2017 1. By way of this appeal, the appellant has challenged thejudgment and order of the Tribunal whereby the Tribunal hasdismissed the appeal relying on the decision of previous year. 2.Following questions were framed by the counsel for the appellant: (i) Whether in the facts and circumstances of the case,the Tribunal was justified in deleting the additions ofRs.3756063/- made by the Assessing Officer valuingclosing stock by including element of excise dutytherein. (ii) Whether on the facts and in law the ITAT wasjustified in deleting the disallowance of export pass feeof Rs. 17000000/- without appreciating the fact thatliability to make such payment is not finalized. (iii) Whether on the facts and in law the ITAT wasjustified in deleting the addition of Rs. 1227542/- madeby the Assessing Officer on account of interest receivedon FDR. (iv) Whether in the facts and circumstance of the case,the Tribunal was justified in law in deleting the addition of Rs.245381200/- made by the Assessing Officer bydisallowing the payment of privilege fees withoutappreciating the fact that the said expenses are ofcapital in nature. (v) Whether in the facts and circumstances of the case,the Tribunal was justified in deleting the addition of Rs.730000/- made by Assessing Officer by disallowingcontribution of State Renewal Fund. (vi) Whether in the facts and circumstances of the case,the Tribunal was justified in deleting the addition of Rs.296283/- made by Assessing Officer for depositing theemployee’s contribution of PF & ESI beyond theprescribed time limit provided in respective Acts. (vii) Whether in the facts and circumstance of the case,the Tribunal was justified in holding that employee’scontribution to PF are governed by the provision ofsection 43B and not by section 36(1)(va) of the IT Act.3.The Tribunal in paragraph 6 observed as under:- “6. We have heard the rival contentions of both theparties and perused the material available on therecord and also gone through the record. It has notdisputed in view of the judgment of Hon’bleJurisdictional High Court in the case of JVVNL 265 CTR62(Raj) and also in the case of CIT Vs SBBJ (2014) 33DTR 131 (Raj) has allowed the contribution towardsPF and ESI in the similar facts and circumstances ofthe case. By respectfully following the Hon’bleJurisdictional High Court decision, we dismiss therevenue’s appeal on this ground and held that theorder passed by the ld CIT(A) in allowing thecontribution towards PF and ESI was in accordancewith law.” 4.The counsel for the appellant contended that the Tribunal hascommitted serious error. However, the issue is now covered by the decision of this Court in Principal Commissioner of Income Tax,Jaipur-2 Vs. M/s. Rajasthan State Ganganagar Sugar Mills Ltd.,decided on 9.11.2016 wherein it has been held as under:- 4.The counsel for the appellant contended that the Tribunal hascommitted serious error. However, the issue is now covered by the decision of this Court in Principal Commissioner of Income Tax,Jaipur-2 Vs. M/s. Rajasthan State Ganganagar Sugar Mills Ltd.,decided on 9.11.2016 wherein it has been held as under:- “In Income Tax Appeal No.172/2016 the Tribunal hasspecifically confirmed the order only in view of thefact that the CIT (Appeals) has followed the decisionof the Tribunal. In all appeals we are not reproducingthe questions of law but in Income Tax AppealNo.128/2015 we are producing the questions of lawas under :specifically confirmed the order only in view of thefact that the CIT (Appeals) has followed the decisionof the Tribunal. In all appeals we are not reproducingthe questions of law but in Income Tax AppealNo.128/2015 we are producing the questions of lawas under : i)Whether in the facts and circumstances of the case,the Tribunal was justified in deleting the additions ofRs.73,20,000/- made by the Assessing Officer holdingthat the Excise Duty cannot be part of valuation offinished stock u/s. 145A and can only levied on theremoval of goods from the premises.the Tribunal was justified in deleting the additions ofRs.73,20,000/- made by the Assessing Officer holdingthat the Excise Duty cannot be part of valuation offinished stock u/s. 145A and can only levied on theremoval of goods from the premises. ii)Whether on the facts and in law the ITAT was justifiedin deleting the addition of Rs.97,15,000/- holding thatthe Export pass fee was allowable expenditure depositof the fact that it was contingent liability.in deleting the addition of Rs.97,15,000/- holding thatthe Export pass fee was allowable expenditure depositof the fact that it was contingent liability. iii)Whether in the facts and circumstances of the case,the Tribunal was justified in law in deleting theaddition of Rs.6,86,900/- made by the AssessingOfficer on account of accrued interest earned onaccrued interest earned on decreed disputedcompensation.the Tribunal was justified in law in deleting theaddition of Rs.6,86,900/- made by the AssessingOfficer on account of accrued interest earned onaccrued interest earned on decreed disputedcompensation. iv)Whether in the facts and circumstances of the case,the Tribunal was justified in deleting the addition ofone crore made by the Assessing Officer by way ofdisallowing privilege fees paid by the assessee toExcise Commissioner Govt. Rajasthan despite the factthat it was application of income.the Tribunal was justified in deleting the addition ofone crore made by the Assessing Officer by way ofdisallowing privilege fees paid by the assessee toExcise Commissioner Govt. Rajasthan despite the factthat it was application of income. v)Whether in the facts and circumstances of the case,the Tribunal has erred in deleting addition ofRs.6,463/- made under Section 36(1)(va) r.w.s. 2(24)(x) of the IT Act for depositing the employee'scontribution to PF & ESI beyond the prescribed timelimit provided in the respective Acts. the Tribunal has erred in deleting addition ofRs.6,463/- made under Section 36(1)(va) r.w.s. 2(24)(x) of the IT Act for depositing the employee'scontribution to PF & ESI beyond the prescribed timelimit provided in the respective Acts. vi)Whether in the facts and circumstances of the case,the Tribunal has erred in holding that employee'scontribution to PF & ESI are governed by the provisionof section 43B and not by section 36(1)(va) r.w.s.2(24)(X) of the IT Act.the Tribunal has erred in holding that employee'scontribution to PF & ESI are governed by the provisionof section 43B and not by section 36(1)(va) r.w.s.2(24)(X) of the IT Act. vi)Whether in the facts and circumstances of the case,the Tribunal has erred in holding that employee'scontribution to PF & ESI are governed by the provisionof section 43B and not by section 36(1)(va) r.w.s.2(24)(X) of the IT Act.the Tribunal has erred in holding that employee'scontribution to PF & ESI are governed by the provisionof section 43B and not by section 36(1)(va) r.w.s.2(24)(X) of the IT Act. However, in view of decision of this Court in DBIncome Tax Appeal No.99/2009, titled asCommissioner of Income Tax Vs. M/s. Rajasthan StateGanganagar Sugar Mills Ltd., decided on 26.05.2016,the issues are completely covered by the said decisionof this Court. Therefore, substantial questions of laware required to be answered in favour of the assesseeand against the Department.” In view of the above, the appeal deserves to be dismissed and the same stands dismissed. (VINIT KUMAR MATHUR)J. (K.S. JHAVERI)J.