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Income Tax Appellate Tribunal, ‘SMC‘ BENCH
Before: SHRI M.BALAGANESH & SHRI SANDEEP SINGH KARHAILShri
आदेश / O R D E R PER M. BALAGANESH (A.M):
This appeal in A.Y.2020-21 arises out of the order by the ld. Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) in appeal No. NFAC/2019-20/10054010 dated 23/11/2022 (ld. CIT(A) in short) against the order of assessment passed u/s.143(1) of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 29/11/2021 by the ld. Asst. Director of Income Tax, CPC, Bangalore (hereinafter referred to as ld. AO).
At the outset, we find that there is a delay in filing of appeal by the assessee before the ld. CIT(A) by 35 days. The ld. CIT(A) had not condoned this delay. The facts of the case is that assessee had voluntarily disallowed a sum of Rs.9,20,652/- towards employees contribution to PF & ESI in his return of income. But the same was added again by the ld.CPC while processing the return u/s.143(1) of the Act. Accordingly, the assessee was pursuing rectification proceedings before the ld. CPC which resulted in no gain to the assessee. By this process, the assessee had missed the appeal filing deadline before the ld. CIT(A). We hold that since assessee was pursuing alternative remedy before the ld. CPC, he had reasonable cause for filing the appeal with a delay of 35 days before the ld. CIT(A). Hence, the ld. CIT(A) ought to have appreciated this aspect while considering the aspect of delay. The action of the ld. CIT(A) by not condoning the delay in these facts and circumstances is illegal and unwarranted. Since the issue in dispute is only with regard to double addition made by the ld. CPC, we proceed to decide this issue here itself.
The only issue to be decided in this appeal is as to whether the Revenue was justified in adding the employee’s contribution to PF and ESI in the sum of Rs.9,20,652/- which was already disallowed by the assessee in his return of income.
3.1. We have heard rival submissions and perused the materials available on record. We have gone through the intimation issued by the ld. CPC u/s.143(1) of the Act, wherein over and above the disallowance made by the assessee in the sum of Rs 9.20,652/-
Shri Rajesh Vidyaniwas Mishra towards employees contribution to PF and ESI, the ld. CPC had disallowed a sum of Rs 9,28,200/-. We have gone through the computation of total income filed by the assessee wherein we find that assessee had indeed disallowed voluntarily a sum of Rs.9,20,652/- as not allowable as deduction. When this was pointed out to the ld. CIT(A), the ld. CIT(A) granted partial relief to the assessee in the sum of Rs.7,548/- (Rs.9,28,200 – Rs.9,20,652/-) against which the Revenue is not in appeal before us. Now what remains is a sustained part of Rs.9,20,652/- by the ld. CIT(A) ignoring the fact that the said sum was already disallowed by the assessee in the return of income. Since, it results in double addition, we have no hesitation in directing the ld. AO to delete the disallowance of Rs.9,20,652/- made by the ld. CPC and erroneously confirmed by the ld. CIT(A). Accordingly, the grounds raised by the assessee are allowed.
In the result, appeal of the assessee is allowed.
Order pronounced on 21/02/2023 by way of proper mentioning in the notice board.