DCIT, CIRCLE 1(3)(1), MUMBAI vs. RCC (SALES) PRIVATE LIMITED, MUMBAI

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ITA 9392/MUM/2025Status: DisposedITAT Mumbai31 July 2026AY 2011-125 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order, finding no reason to interfere as the AO's remand report confirmed the payments were in order. The Revenue failed to demonstrate the applicability of the Supreme Court's decision in Checkmate Services.

What were the facts?

The Assessing Officer disallowed late payments of PF and ESIC. The CIT(A) deleted this disallowance after a remand report from the AO found the payments to be in order. The Revenue appealed this deletion.

What were the issues?

Whether disallowance for late payment of PF and ESIC is justified when payments are made before the due date for filing the return of income. Applicability of Supreme Court's decision in Checkmate Services.

Which sections of the Income-tax Act were involved?

Section 43B,Section 139

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH MUMBAI

Before: HON’BLE SHRI SANDEEP GOSAIN & HON’BLE SHRI BIJAYANANDA PRUSETH

For Respondent: Shri Umashankar Prasad (CIT DR) &, Shri Annavaram Kosuri, SR AR
Hearing: 20.05.2026Pronounced: 31.07.2026

आदेश / ORDER PER SANDEEP GOSAIN, JM: The present appeal has been filed by the Revenue challenging the impugned order dated 24.10.2025 passed u/s 250 of the Income Tax Act, 1961 ('the Act'), by the office of the Commissioner of Income-tax (Appeals)-54, Mumbai for the assessment year 2011-12. The grounds raised by the Revenue are reproduced below:

2 ITA No.9392/Mum/2025 RCC (Sales) Pvt. Ltd.

“1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) was justified in deleting the disallowance made on account of late payment of PF and ESIC amounting to Rs. 2,06,16,102/- and Rs. 17,09,933/- ignoring the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. v. Commissioner of Income-tax-1 (2022) 143 taxmann.com 178(SC)? 2. The appellant craves to leave to amend or alter any grounds or add new ground which may be necessary.”

2.

None appeared on behalf of the assessee when the case was called repeatedly, which shows that the assessee is not interested in pursuing the present appeal.

2.1. Whereas, on the contrary, the Ld. D.R., present in the Court, is ready with the arguments. Therefore, we have decided to proceed with the hearing of the case ex parte.

3.

The solitary ground raised by the Department relates to challenging the order of the Ld. CIT(A) deleting the disallowance made on account of the late payment of PF and ESIC.

4.

We have heard the Ld. D.R., perused the material placed on record, the judgments cited before us, and the orders passed by the revenue authorities. From the records, we noticed that, on perusal of the auditor's report, the A.O. observed that the assessee had made payment towards PF amounting to Rs. 2,06,16,102/- and ESIC amounting to Rs. 17,09,933/- beyond the due dates. Since the same was not treated as allowable by the Assessing Officer, the said amounts were added to the total income of the assessee. However, during the appellate proceedings before the Ld. CIT(A), the assessee relied upon

3 ITA No.9392/Mum/2025 RCC (Sales) Pvt. Ltd.

Annexure IV of the tax audit report, which contains particulars such as the month, the amount of recoveries made from the employees, and the due dates of payment in respect of PF and ESIC. From the records, we noticed that the Assessing Officer proceeded on the basis of the due dates prescribed under the relevant statutes; however, he ignored the provisions of Section 43B of the Income-tax Act, according to which no disallowance shall be made if the amounts are actually paid by the assessee on or before the due date applicable for furnishing the return of income under sub-section (1) of Section 139 of the Income-tax Act. Therefore, a remand report was called for during the course of the appellate proceedings, and after examining the issue and making necessary inquiries, the findings of the A.O. in the remand proceedings were reproduced in the order of the Ld. CIT(A), which are reproduced below:

" 7.3 Remand proceedings:

A remand report was called for from the AO with regard to disallowance of PF of Rs.2,06,16,102/- and ESIC of Rs. 17,09,933/-. After examining the above issues and making necessary enquiries, the findings of the AO in the remand report are reproduced as under:

The second issue in dispute is the disallowance of late payment of PF & ESIC. The assessee made the payment of ESIC and PF beyond the due date of relevant statute.

1.

Provident Fund: Rs.2,06116,102/-

2.

ESIC Rs. 17,09,933/-

4 ITA No.9392/Mum/2025 RCC (Sales) Pvt. Ltd.

The Ld.AO has disallowed PF of Rs.2,06,16,102/- and ESIC of Rs. 17,09,933/-as payments were made beyond the due date. During the course of filing of return of income, the said information was already provided and same is furnished again, and found to be in order.

7.4 Decision:

As the AO found the expenditure claim on account of PF and ESIC to be in order, the disallowance of PF expenses of Rs.2,06,16,102/- and ESIC expenses of Rs. 17,09,933/- is deleted.

Accordingly, the 3rd ground of appeal is allowed.

5.

After having considered the order passed by the Ld. CIT(A) and the findings of the A.O. in the remand proceedings, we find that the A.O. had initially disallowed the amounts relating to PF and ESI by holding that the payments were made beyond the due dates. However, during the appellate proceedings, a remand report was called for, wherein the A.O. categorically stated that the details regarding the payment of PF and ESI had already been furnished by the assessee and, after examining the same, found them to be in order. Therefore, considering these facts and the report of the A.O. in the remand proceedings, the disallowances on account of PF and ESI expenses were deleted.

6.

No new facts or circumstances have been brought before us to rebut or controvert the findings so recorded by the Ld. CIT(A). The Ld. D.R. also failed to convince us as to how the decision of the Hon'ble Supreme Court in the case of Checkmate Services Private Limited vs. CIT [(2022) 143 taxmann.com 178 (SC)] is

5 ITA No.9392/Mum/2025 RCC (Sales) Pvt. Ltd.

applicable to the facts of the present case or has not been duly considered. Therefore, we see no reason to interfere.

7.

Even otherwise, no new facts or circumstances have been brought before us to controvert or rebut the findings so recorded by the Ld. CIT(A). Therefore, we see no reason to interfere with or deviate from the well-reasoned findings, particularly when the same are based on the remand report submitted by the A.O. Accordingly, the ground raised by the Revenue stands dismissed.

8.

Consequently, appeal stands dismissed. No order as to cost.

Order pronounced in the open court on 31.07.2026.

Sd/- Sd/- (BIJAYANANDA PRUSETH) (SANDEEP GOSAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Dated 31/07/2026 KK, PS

आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : अपीलार्थी / The Appellant 1. प्रत्यर्थी / The Respondent. 2. संबंधित आयकर आयुक्त / The CIT(A) 3. आयकर आयुक्त(अपील) / Concerned CIT 4. धिभागीय प्रधतधिधि, आयकर अपीलीय अधिकरण,मुम्बई/ DR, ITAT, Mumbai 5. 6. गार्ड फाईल / Guard file. आदेशानुसार/BY ORDER, सत्याधपत प्रधत //True Copy// उि/सहायक िंजीकार ( Asst. Registrar) आयकर अिीिीय अतिकरण, मुम्बई / ITAT, Mumbai

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