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Income Tax Appellate Tribunal, MUMBAI BENCHES “G”, MUMBAI
Before: Shri B R Baskaran, Hon’ble, & Shri Narender Kumar Choudhry, Hon’ble
O R D E R Per B R Baskaran, Accountant Member:
The assessee has filed this appeal challenging the order dated 26-10-2021 passed by Ld CIT(A), NFAC, Delhi and it relates to the assessment year 2018-19.
This appeal was initially disposed of by the Tribunal, vide its order dated 28-07-2022 deciding the issue of late payment of employees’ contribution to PF/ESI in favour of the assessee. Subsequently, consequent to the miscellaneous application filed by the revenue upon receipt of order passed by Hon’ble Supreme Court in the case of Checkmate Services P Ltd (2022)(448 ITR 518)(SC), the above said order was recalled by the Tribunal in the order dated 12-09-2023 passed in M A No.224/Mum/2023. Accordingly, this appeal was placed before us by the Registry.
The assessee had paid employees’s contribution to PF/ESI amounting to Rs.3,41,344/- beyond the due date prescribed in the respective Acts and hence the AO did not allow deduction of the same u/s 36(1)(va). The Ld CIT(A) also confirmed the order of the AO and hence the assessee has filed this appeal.
The Ld A.R submitted that the above said amount of Rs.3,41,344/- pertained to the month of September, 2017. He submitted that the assessee had generated the challan on 13th October, 2017. However, due to some technical problems, it could not make payment on or before 15th October, 2017, but it was paid on 17th October, 2017, with a delay of 2 days. Considering the technical problem, the Ld A.R submitted that the same should be allowed u/s 36(1)(va) of the Act. The Ld A.R further submitted that the CPC has disallowed the above said amount while processing the return of income u/s 143(1) of the Act. However, the decision rendered by Hon’ble Supreme Court in the case of Checkmate Services P Ltd is related to a case of assessment completed u/s 143(3) of the Act. Accordingly, he submitted that the above said decision of Hon’ble Supreme Court should not be applied to the facts of the present case.
The Ld D.R, on the contrary, submitted that the Hon’ble Supreme Court has only interpreted the law already existing in the statute and hence the same should be applied to the provisions since the date of its inception. Accordingly, he submitted that there is no scope for not applying the said decision of Hon’ble Supreme Court to the intimation issued u/s 143(1) of the Act. With regard to the claim of technical problems, the ld D.R submitted that the assessee has not furnished any proof for the said claim. He further submitted that the assessee has also not explained as to whether the technical problem is in assessee’s side or in PF/ESI office side. He submitted that, whenever there were technical glitches in the PF/ESI office side, they have extended the due date. He submitted that the assessee has not furnished any notification for extension of due date. Accordingly, he submitted that the decision rendered in the case of Checkmate Services P Ltd by Hon’ble Supreme Court shall apply in this case also.
We heard rival contentions and perused the record. We notice that the Hon’ble Supreme Court has held in the case of Checkmate Services P Ltd (supra) that the payment of employees contribution of PF/ESI should be paid before the due date prescribed in the respective Statues in order to avail deduction u/s 36(1)(va) of the Act. It is well settled principle of law that the Hon’ble Supreme Court only interprets the law and does not make any new law. Hence the interpretation given by Hon’ble Supreme Court shall apply from the date of inception of the relevant provisions. Hence, at this stage, one cannot ignore the decision rendered by Hon’ble Supreme Court in the case of Checkmate Services P Ltd (supra).
The Ld A.R also submitted that the assessee had generated the payment challan on 13th October, 2017 itself, but the payment could not be made within due date due to technical glitches. However, as pointed out by Ld D.R, no material was brought on record to support the said submission. Hence we have no other option, but to reject the same.
In view of the above, we hold that the addition of Rs.3,41,344/- made u/s 36(1)(va) of the Act for belated payment of employees contribution to PF/ESI is in accordance with the law. Accordingly, we uphold the order passed by Ld CIT(A) on this issue.
In the result, the appeal filed by the assessee is dismissed.
Order pronounced in the open court on 26.10.2023.