The assessee has questioned first appellate (order) on the (ground) that the learned CIT(A) has erred in facts and law in :

1. confirming the addition of Rs. 17,01,90,088 on account of delay in deposit of employees' contribution to CPF/GPF/ESI under section 36(1)(va);

2. confirming the disallowance of Rs. 2,04,83,00,000 under section 40(a)(ia) in respect of alleged non-deduction of tax at source on transmission/ wheeling/SLDC charges by holding that such payment is liable for deduction of tax at source under section 194J;

2.1. not appreciating the fact that the payment of State Load Dispatch Center charges (SLDC) to RVPN is a statutory levy which is not liable for deduction of tax at source;

2.2. confirming the disallowance under section 40(a)(ia) ignoring the fact that the recipient of the payment (RRVPN) has no income liable to tax and has been assessed by the same AO at nil income;

2.3. not appreciating the fact that payment of wheeling/SLDC charges is nothing but only sharing of cost, i.e., reimbursement of actual expenses to Rajasthan Rajya Vidhyut Prasaran Nigam Ltd., no income is paid and therefore, outside the provisions of Chapter XVII-B of the IT Act, 1961. He has further erred in observing that it is not the case of clear reimbursement of the expenditure;

2.4. not directing the Dy. CIT, Circle-6, to determine the actual payment of wheeling/SLDC charges made to RVPNL which is Rs. 182.05 crores in respect of wheeling/transmission charges and Rs. 6.29 crores in respect of SLDC charges;

2.5. not considering the fact that disallowance under section 40(a)(ia) can be made only when the amount on which tax is deductible at source is payable and not when the amount is actually paid. In the present case the amount is actually paid and therefore no disallowance under section 40(a)(ia) can be otherwise made; and

3. confirming the charging of interest under section 234B at Rs. 20,85,26,798. We have gone through the order of the lower authorities, material available on records and the decisions relied upon while considering the arguments advanced by the parties.

Ground No. 1

2. The AO made disallowance of Rs. 17,01,90,088 under section 36(1)(va) of the Act oh account of delayed payment of employees' contribution of PF and ESI. The CIT(A) by following the decision of Jaipur Bench in assessee's own case for asst. yrs. 2001-02 to 2005-06 in ITA No. 824 to 828/Jp/2008 order dt. 30th Sept., 2008 upheld the disallowance made by the AO by observing that the other decision of the Jaipur Bench Allowing the same where payment is made before due date of filing of return are prior to the decision given in the assessee's own case in this issue.

2.1. The learned Authorised Representative relied on the decision of Karnataka High Court in case of CIT v. Sabari Enterprises [2007] 213 CTR (Kar) 269 : [2008] 2 DTR (Kar) 394 : [2008] 298 ITR 141 (Kar) and CIT v. P.M. Electronics Ltd. [2008] 220 CTR (Delhi) 635 : [2009] 177 Taxman 1 (Delhi). He further submitted that against the order of Tribunal dt. 30th Sept., 2008 an application under section 254(2) has been filed which is pending for disposal. He also relied on the subsequent decision of this Bench in ITA No. 185/Jp/2008, dt. 13th Feb., 2009 and ITA No. 914/Jp/2008, dt. 31st Dec, 2008 wherein it was held that employees' contribution to PF and ESI if paid before due date of filing of return under section 139(1) could not be disallowed. The learned Departmental Representative on the other hand relied on the orders of the lower authorities.

2.2. After hearing the parties we find that there is no dispute in the present case that the employees' contribution to PF and ESI was paid, before the due date of filing of return under section 139(1) though after the statutory dates specified in the respective Acts. This is supported by the decision of Karnataka High Court in case of Sabari Enterprises (supra), P.M. Electronics Ltd. (supra) and Sunil Goel v. Asstt. CIT [2008] 118 TTJ (Delhi) 41