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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
O R D E R
PER PAVAN KUMAR GADALE JM:
The assessee has filed the appeal against the order of National Faceless Appeal Centre (NFAC), Delhi/ CIT(A) passed u/s 143(1) and 250 of the Act.
The Hon’ble Tribunal in the Miscellaneous application filed by the Revenue in MA No. 127/Mum/2023 dated 07.07.2023 has recalled the Hon’ble Tribunal order dated 11.05.2022 considering the decision of the Hon’ble Supreme Court in the case
Nilamber Dyeing and Bleaching Mills Pvt Ltd, Mumbai. - 2 - of Checkmate Services Pvt Ltd vide civil application No. 2833 of 2016 dated 12.10.2022 where in employers have to deposit employees contribution towards ESIC and PF on or before the due date as prescribed in the respective Act. Now the appeal is posted for hearing.
The assessee has raised the following grounds of appeal:
1.1 On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeal) (CIT(A))- National Faceless Appeal Centre (NFAC) erred in not adjudicating the ground No. 2 to 5 raised as per From No. 35 pertaining to section 143(1)(a) by treating the same as general in nature. Addition is confirmed arbitrarily ignoring the facts and merits of the case and is unjustified and bad in law and the same needs to be adjudicated; 1.2 The learned Commissioner of Income-tax (Appeal) (CIT(A))- National Faceless Appeal Centre (NFAC) failed to consider the objection for adjustment u/s.143(1)(a)(iv) in response to intimation for proposed adjustment. 1.3 The learned Commissioner of Income-tax (Appeal) (CIT(A))- National Faceless Appeal Centre (NFAC) ought to have appreciated that the adjustment made u/s.143(1)(a)(iv) is bad, illegal, void, against the provision of the law and is arbitrary.
Nilamber Dyeing and Bleaching Mills Pvt Ltd, Mumbai. - 3 -
1.4 The Learned Commissioner of Income-tax (Appeal) (CIT(A))- National Faceless Appeal Centre (NFAC) ought to have given an opportunity of being heard. 2.1 On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeal) - NFAC erred in disallowing payment/deposit of provident fund (employees contribution) of Rs.360,529/- and ESIC Fund (employees contribution) Rs.1,53,883/-, as the same are not deposited within the due- date. Addition is confirmed arbitrarily ignoring the various judicial pronouncements and merits of the case and is bad in law and the same needs to be deleted.
2.2 The learned Commissioner of Income-tax (Appeal) - NFAC erred in not following decision of the jurisdictional High Court and relied on circular of CBDT.
2.3 The Learned Commissioner of Income Tax (Appeal) NFAC ought to appreciated that the have sum received by the appellant from his employees to which the provisions of section 2(24)(x) apply, such sum is credited to the relevant fund before the due date of filing return of income u/s.139(1) of the Income Tax Act, 1961 . The appellant craves leave to add, alter, amend or delete any of the above ground or ground of appeal.
3. The brief facts of the case are that the assessee is engaged in the business of processing of fabrics on job work. The assessee has filed the return of income for the A.Y 2019-20 on 21.10.2019 disclosing a total income of Rs. 7,42,930/- and the return of income was processed u/s 143(1) of the Act. Where the Nilamber Dyeing and Bleaching Mills Pvt Ltd, Mumbai. - 4 - employees contribution (PF&ESI) aggregating to Rs. 5,14,412/- was disallowed u/s 36(1)(va) of the Act due to delay of deposit of PF & ESI under respective Acts and the total income was determined at Rs. 12,57,340/-.
Aggrieved by the order, the assessee has filed an appeal before the CIT(A), whereas the CIT(A) considered the grounds of appeal, submissions of the assessee and findings of the AO but has confirmed the action of the A.O. Aggrieved by the CIT(A)order. the assessee has filed an appeal before the Hon’ble Tribunal.
At the time of hearing, none appeared on behalf of the assesse and heard the Ld. DR submissions and perused the material on record. The sole matrix of the disputed issue is with respect to the disallowance of provident fund (PF) and ESIC made by the AO u/sec 143(1) of the Act and the details of PF&ESIC deposits were never verified as the return of income was processed U/sec143(1) of the Act and the assessee mentioned in the grounds of appeal that no proper opportunity was given before CIT(A) in the hearing
Nilamber Dyeing and Bleaching Mills Pvt Ltd, Mumbai. - 5 - proceedings. Therefore, considering the facts, circumstances and to meet the ends of justice shall provide with one more opportunity of hearing to the assessee to substantiate the claims and therefore for limited purpose, restore the disputed issue to the file of the Assessing officer to examine and verify the claim and decide on the merits. And the assessee should be provided adequate opportunity of hearing and the assessee should cooperate in submitting the information. Accordingly, the grounds of appeal of the assessee are allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purpose Order pronounced in the open court on 22.08.2023.