CES LIMITED ,HYDERABAD vs. DY. COMMISSIONER OF INCOME TAX , CIRCLE-1(2), HYDERABAD

O R D E R PER S.S.GODARA, J.M. :

This assessee’s appeal for AY.2014-15 arises from the CIT(A)-1, Hyderabad’s order dated 18-02-2019 passed in case No. 0212 / 2016-17 / ITO-17(1) / CIT(A)-1 / Hyd / 2018-19, in proceedings u/s.143(3) of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both the parties. Case filed perused.

“1. The order of the CIT(A) is erroneous both on facts and in law. 2. The Ld.CIT(A) ought to have allowed the ground of appeal with regard to the disallowance of Rs.3,46,655/- instead of directing the AO to verify further.

3. The Ld.CIT(A) ought to have allowed the ground of appeal in respect of credit for TDS of Rs.2,23,29,360/- instead of directing the AO to verify further.

4. The appellant may add, alter or modify any other points to the grounds of appeal at any time before or at the time of hearing of the appeal”.

3. It transpires during the course of hearing that we need not delve much deeper in the relevant facts. The Assessing Officer had made the above stated two disallowances of assessee’s ESI/PF payments and followed by addition of short credit of TDS of Rs.2,23,29,360/- in the course of assessment which in turn stand restored back to him by the CIT(A) in his lower appellate order to accept the corresponding claims after due verification of facts.

4. We have given our thoughtful consideration to rival contentions. The assessee’s only case is that the CIT(A) no more possesses the jurisdiction to set aside the said issues in his lower appellate adjudication since the relevant statutory expression ‘or he may set aside’ in Section 251(1)(a) of the Act stands omitted by the Finance Act, 2001 w.e.f. 01-06-2001. The Revenue is equally fair in not disputing the foregoing legal plea. The fact also remains that both the assessee’s substantive grievances indeed require factual verification regarding the due date so far as its ESI/PF disallowance is concerned as well as the TDS credit figures in form 26AS viz-a-viz the books of accounts. We therefore reverse the CIT(A)’s action in principle but adopt the very cause of action in the assessee’s twin substantive grounds in the larger interest of justice. The assessee is directed to appear before the Assessing Officer on or before 31-08-2021 along with all the necessary details to be followed by three effective opportunities of hearing; at its own risk and responsibility.

Order pronounced in the open court on 22nd April, 2021