No AI summary yet for this case.
Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI ABY T. VARKEY, JM & SHRI OM PRAKASH KANT, AM
O R D E R PER ABY T. VARKEY, JM: These are appeals preferred by the assessee company against the order of the Ld. CIT(A)/NFAC dated 16.11.2022 for AY 2011-12 and AY 2018-19.
The main grievance of the assessee is against the action of the Ld. CIT(A) confirming the disallowance of Rs. 48,19,696/- for the AY 2011-12 u/s 143(3) of the Income Tax Act, 1961 (herein after ‘the Act’) and Rs. 1,48,61,729/- (AY 2018- 19) u/s 143(1) of the Act, both on account of disallowance of employees contribution of provident fund and ESIC u/s 36(1) (va) of the Act. Since, the issue 2 are the same, we take up the appeal for AY 2011-12 as the lead case and result of which will be followed for AY 2018-19.
Brief facts as noted by the Ld. CIT(A) is that assessee had filled the original return of income on 30-09-2011 declaring total income of Rs. 16,45,005/-. Later the case of the assessee was reopened u/s 147 of the Act on the ground that the assessee failed to deposit the ‘employees contribution’ to provident fund and ESIC within the due date as prescribed by the PF/ESI Act and therefore, the same cannot be allowed as deduction and therefore, such amount has escaped assessment. The AO after taking note of the dates on which employees contribution to PF/ESIC has been made in a chart format in the assessment order, he held that assessee failed to depositing the same within due date as prescribed under the PF/ESI Act; and so he disallowed an amount of Rs. 48,19,696/- (Rs. 10,63,208/- and Rs. 37,56,488/-). Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) who was pleased to dismiss the same by the taking note of the Hon’ble Supreme Court decision in Checkmate Services P. Ltd vs CIT wherein the Hon’ble Supreme Court upheld the action of the Revenue disallowing the claim of deduction of Employee’s contribution for failure to remit the same within the due date as prescribed under PF/ ESI Act. Thus Ld. CIT(A) noted that issue involved in the appeals were no longer res-Integra; and held that the employees contribution to provident fund/ employees state insurance etc are allowable as deduction only if remitted in Government Treasury before the statutory due date as prescribed by the respective statutes (Employees Provident Fund Act and ESI Act). And the Ld. CIT(A) has passed the impugned orders confirming the action of the AO.
Aggrieved, the assessee is before us.