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Facts
The assessee appealed against the disallowance of employees' contribution to provident fund for assessment year 2019-20. The disallowance was based on the contribution not being deposited before the due date for filing the return of income.
Held
The Tribunal noted that the explanation for the delay in depositing the cheque was not adequately supported by evidence before the lower authorities. Therefore, the appeal was allowed for statistical purposes, remanding the issue for readjudication.
Key Issues
Whether the delay in depositing the employee's contribution to provident fund can be condoned on the basis of circumstances beyond control, and if the same is supported by evidence.
Sections Cited
36(1)(va), 139(1), 143(3)
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Income Tax Appellate Tribunal, DELHI BENCH: ‘B’ NEW DELHI
Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL
Date of hearing 03.06.2025 Date of pronouncement 03.06.2025 ORDER
PER SATBEER SINGH GODARA, JM
This assessee’s appeal for assessment year 2019-20, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2023-24/1058834503(1), dated 18.12.2023 involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.
The assessee’s instant appeal canvasses its sole substantive grievance seeking to reverse both the learned lower authorities’ action invoking section 36(1)(va) disallowance of employees’ contribution towards provident fund amounting to Rs. 53,74,605/- in assessment order dated 30th September, 2021 and upheld in the lower appellate discussion.
The Revenue vehemently invites our attention to hon’ble apex court’s recent landmark decision in Checkmate Services Pvt. Ltd. Vs. CIT [2022] 143 taxmann.com 278(SC) that the instant issue is no more res integra since decided in the department’s favour; and, therefore, both the lower authorities have rightly held the assessee not to have credited/deposited the above employees’ contribution on or before the due date in the corresponding statute than that of filing section 139(1) return.
Faced with this situation, learned counsel takes us to pages 67 to 69 (para 8.3.1 to 8.4.2) in the lower appellate discussion wherein it had inter alia sought to explain the fact that the assessee had duly deposited its cheque/negotiable instruments in the bank account on 11th May, 2018 which got encashed by 16.05.2018 only; and, therefore, we ought to go by the above bana fide facts and 2 | P a g e delay in presenting and encashment of the cheque deserves to be condoned on account of circumstances beyond control. The fact however remains that the above explanation has not been property supported by the corresponding evidence before the learned lower authorities. We therefore, deemed it appropriate with the consent of both the parties that the assessee’s instant sole substantive grievance deserves to be re-adjudicated by the learned Assessing Officer as per law within three effective opportunities, in above terms. Ordered accordingly.