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Income Tax Appellate Tribunal, “A” BENCH, PUNE
Before: SHRI INTURI RAMA RAO & SHRI S.S. VISWANETHRA RAVI
आदेश / ORDER
PER S.S. VISWANETHRA RAVI, JM :
This appeal by the assessee against the order dated 09-02-2023 passed by the National Faceless Appeal Centre, Delhi (“NFAC”) for assessment year 2018-19.
We find that this appeal was filed with a delay of 01 day. Upon hearing ld. DR, the delay of 01 day is condoned.
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We find no representation on behalf of the assessee nor any application filed seeking adjournment. Thus, the assessee called absent and set ex-parte. Therefore, we proceed to dispose of the appeal by hearing the ld. DR and perusing the material available on record.
The only issue is to be decided is as to whether the CIT(A), NFAC, Delhi justified in confirming the addition made by the CPC u/s. 36(1)(va) of the Act.
Heard ld. DR and perused the material available on record. We note that the assessee is proprietor of M/s. Kudale Engineering Works, filed return of income on 30-10-2018. The CPC, Bangalore disallowed an amount of Rs.5,08,100/- for not depositing the employee’s contribution of PF/ESI before prescribed due dates under the respective Act. Having aggrieved, the assessee preferred an appeal before the CIT(A), NFAC, Delhi. The assessee contended that the assessee is entitled to claim deduction if the employee’s contribution is paid before due date of filing return of income. The CIT(A), NFAC, Delhi on an examination of Tax Audit Report held that the assessee did not deposit an amount of Rs.5,08,100/- which is employee’s contribution towards PF/ESI before the due date under the respective Act and confirmed the disallowance made by the CPC, Bangalore for delay in depositing the said employee’s contribution before due dates concerning the relevant Act. The ld. DR placed on record the decision of Hon’ble Supreme Court in batch of the appeals, lead case being Checkmate Services P. Ltd. in Civil Appeal No. 2833 of 2016 and submitted that the assessee is not entitled to claim deduction if the employee’s contribution is not paid within due dates of respective statutes. On careful reading of the said decision of Hon’ble Supreme Court held that Section 2(24)(x) deems
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amount received from the employees as income and the amounts retained by the employer from out of the employee’s income by way of deduction etc. were treated as income in the hands of the employer (assessee). Further, it held unless the conditions spelt by Explanation to section 36(1)(va) are satisfied i.e., depositing such amount received or deducted from the employee on or before the due date of respective statutes, the assessee is not entitled to claim benefit of deduction from the total income. Therefore, in our opinion, essential condition for claiming such deduction if such amounts are deposited on or before due date of respective statutes. It is evident from the impugned order that the assessee deposited the employee’s contribution to PF/ESI after the prescribed due date of relevant Act which is not disputed by the ld. AR. Therefore, following the decision of Hon’ble Supreme Court in the case of Checkmate Services P. Ltd. (supra) we find no infirmity in the order of CIT(A), NFAC, Delhi in holding the assessee is not entitled to claim deduction for its failure to deposit employee’s contribution before due date prescribed under the relevant statutes. Thus, the ground raised by the assessee is fails and it is dismissed.
In the result, the appeal of assessee is dismissed.
Order pronounced in the open court on 17th May, 2023.
Sd/- Sd/- (Inturi Rama Rao) (S.S. Viswanethra Ravi) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; दिनाांक / Dated : 17th May, 2023. रदव
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आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : अपीलार्थी / The Appellant. 1. प्रत्यर्थी / The Respondent. 2. 3. The concerned CIT, Pune. दवभागीय प्रदतदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, 4. पुणे / DR, ITAT, “A” Bench, Pune. गार्ड फ़ाइल / Guard File. 5. //सत्यादपत प्रदत// True Copy// आिेशानुसार / BY ORDER,
वररष्ठ दनजी सदचव / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune