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Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL,
Before: ARUN KHODPIA & ARUN KHODPIA & ARUN KHODPIA
O R D E R Per Bench This is an appeal filed by the assessee This is an appeal filed by the assessee against the order of the ld against the order of the ld CIT(A), , NFAC, NFAC, Delhi Delhi dated 30.7.2021 in Appeal No. ITBA/NFAC/S/250/2021 ITBA/NFAC/S/250/2021-22/1034539422(1) for the assessment year the assessment year 2018- 19.
Shri S.K.Agarwalla, ld AR appeared for the assessee and Shri Shri S.K.Agarwalla, ld AR appeared for the assessee and Shri Shri S.K.Agarwalla, ld AR appeared for the assessee and Shri S.C.Mohanty, ld SR DR appeared for the revenue. S.C.Mohanty, ld SR DR appeared for the revenue.
The appeal is barred by limitation by 196 days. The assessee has The appeal is barred by limitation by 196 days. The assessee has The appeal is barred by limitation by 196 days. The assessee has filed condonation petition filed condonation petition supported by affidavit stating therein that as the stating therein that as the assessee was ill health and continuance of essee was ill health and continuance of pandemic COVID COVID-19, the appeal
P a g e 1 | 5 could not be filed within the stipulated date. Ld AR reiterating the submission in the petition prayed that the delay in filing of the appeal be condoned. Ld Sr DR did not have any objection to the request of ld AR of the assessee. Consequently, we condone the delay of 196 days and admit the appeal for hearing.
It was submitted by ld AR that there are three issues in assessee’s appeal, first was against the disallowance u/s.43B in respect of employees contribution to PF and ESI, second was against the disallowance of employer’s contribution to PF and ESI and third was against the disallowance in respect of CGST, SGST and IGST, all relating to the payment made before the due date of filing of return but after the due date under the respective Act. It was the submission that the issue was squarely covered by the decision of the Co-ordinate Bench in the case of Biswajit Nayak in for the A.Y. 2018-19 order dated 25.11.2022, wherein, on similar issues, it has been restored to the file of the AO for verification and necessary adjudication.
In reply, ld Sr DR vehemently supported the order of the AO as well as ld CIT(A). It was the submission that in the audit report in respect of the assessee at Clause No.26(i)(B)(b) and Clause No.26(i)(B)(a), the auditors have specifically mentioned that PF and ESI and CGST, SGST and IGST have been paid after the due date of filing of the return as provided
P a g e 2 | 5 u/s.139(1) of the Act. It was the submission that the order of the AO and ld CIT(A) was liable to be upheld
In reply, ld AR submitted that the audit report could be erroneous insofar as the same has been filled up by the employees of the auditors. It was the prayer that the issues may be restored to the file of the AO for re- adjudication.
We have considered the rival submissions. A perusal of the facts in the present case clearly shows that three issues in assessee’s appeal are identical to the issues decided by the Co-ordinate Bench in the case of Biswajit Nayak (supra), wherein, in paras 7 to 9, it has been held as follows:
“7. We have considered the rival submissions. In respect of the issue of employees contribution to PF and ESI, admittedly, the issue is squarely covered by the decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt Ltd (supra), wherein, it has been categorically held that if the employees contribution to PF and ESI has been paid beyond the time prescribed under the relevant PF Act, then same is not allowable under section36(1)((va) and 43B even though the payment has been made before the due date of filing of return under the Income tax Act. However, as regards the claim of allowance u/s.37(1) of the Act, the issue is covered by the decision of this Co-ordinate Bench in the case of Nirakar Security & Consultancy Services Pvt Ltd(supra), wherein, the issue is restored to the file of the Assessing officer with the following directions: “6. Liberty is granted to the ld AR to make all submissions in respect of allowability of disallowed contribution of the employees to PF and ESI under other relevant provisions in the interest of justice. This direction is being given because ld AR has submitted that as the amount is not allowable under section 36(1)(va) of the Act and same is also not covered under section 43B of the Act, the amount of delayed contribution to PF and ESI in respect of employees contribution would be treated as income in the hands of the assessee u/.s.2(24)(x) and on subsequent payment of the same, it would be a business expenditure, which can be claimed u/s.37(1) of the Act. We are not expressing any opinion in regard to his arguments P a g e 3 | 5 as it has not been examined by the lower authorities. Liberty is also granted to the assessee to raise all arguments as are found necessary by him before the lower authorities.” Hence, on identical findings this issue is restored to the file of the AO for re-adjudication after granting the assessee adequate opportunity of being heard.
8. In regard to the issue of employer’s contribution to PF and ESI, as it is noticed that the issue is covered by the decision of Hon’ble Supreme Court in the case of Alom Extrusions Ltd(supra), the disallowance is directed to be deleted. However, for the purpose of verification as to whether the amounts have been paid before the due date of filing of return, the issue is restored to the file of the AO. If the payments have been made before the due date of filing of the return, then no disallowance is to be made.
9. Similarly, in respect of CGST and SGST, the issue is restored to the file of the AO for examination as to whether same had been paid before the due date of filing of return under the Income tax Act. If the same has been paid before the due date of filing of return, then in view of the provisions of section 43B, no disallowance is called for.”
As the issues in the case of Biswajit Nayak (supra) are identical in the impugned appeal, on identical findings, the issues are restored to the file of the AO for re-adjudication after granting the assessee opportunity of hearing.
In the result, appeal of the assessee stands partly allowed for statistical purposes.
Order dictated and pronounced in the open court on 15/02/2023.