M/S. B.C.H. ELECTRIC LTD.,,KOLKATA vs. DCIT, CIRCLE 7(1),, KOLKATA

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ITA 2454/KOL/2025Status: DisposedITAT Kolkata28 April 2026AY 2013-20143 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The tribunal dismissed the disallowance of employees' PF/ESI contribution, citing the Supreme Court's decision in Checkmate Services Pvt. Ltd. However, it allowed the deduction for director's residence expenses and directed the AO to allow the Section 80IC deduction, setting aside the CIT(A)'s order.

What were the facts?

The assessee appealed against the NFAC's order for AY 2013-14 concerning disallowances related to employees' PF/ESI contribution, director's residence expenses, and Section 80IC deduction. The appeal involved multiple grounds of dispute.

What were the issues?

Whether delayed deposit of employees' PF/ESI contribution is allowable as a deduction, and the allowability of director's residence expenses and Section 80IC deduction.

Which sections of the Income-tax Act were involved?

Section 2(24)(x),Section 36(1)(va),Section 43B,Section 37(1),Section 80IC,Section 250

AI-generated summary — verify with the full judgment below

Before: Shri Rajesh Kumar, AccountantMember & Shri Pradip Kumar Choubey, JudicialMember

आयकर अपील�य अ�धकरण, कोलकाता पीठ, कोलकाता IN THE INCOMETAX APPELLATE TRIBUNAL “A”BENCH KOLKATA Before Shri Rajesh Kumar, AccountantMember and Shri Pradip Kumar Choubey, JudicialMember ITA No.2454/Kol/2025 Assessment Year: 2013-14 M/s B. C. H. Electric Ltd………....………………….……….……….……Appellant C/o M/s SalarpuriaJajodia& Co., 7, C. R Avenue, 3rd Floor, Kol-72. [PAN: AABCB2076M] vs. DCIT, Circle-7(1), Kolkata…...……...…………………….....……...…..…..Respondent Appearances by: Shri Siddharth Jhajharia, FCA, appeared on behalf of the appellant. Shri Pankaj Pandey, Sr. DR,appeared on behalf of the Respondent. Date of concluding the hearing :April 23, 2026 Date of pronouncing the order :April 28 , 2026 ORDER PerPradip Kumar Choubey, Judicial Member: This appeal filed by the assessee is directed against the order dated 14.08.2025 of the NFAC, Delhi passed u/s 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2013– 14.

2.

Ground No.1 is against the confirmation of disallowance of Rs.80,913/- by the ld. CIT(A) u/s 2(24)(x) r.w.s. 36(1)(va) towards employees’ contribution to PF/ESI.

3.

After hearing both the parties, we note that the issue has already decided by the Hon’ble Supreme Court in Checkmate Services Pvt. Ltd. Vs. CIT (2022) 143 taxmann.com 178 (SC) dated 12.10.2022 wherein it has been held that deduction u/s 36(1)(va) in respect of delayed deposit

ITA No.2967/Kol/2025 of amount collected towards employees’ contribution to PF cannot be claimed even though deposited within the due date of filing of return even when read with Section 43B of theAct. Considering the same, Ground no.1 raised by the assessee is dismissed.

4.

Ground No.2 is in relation to disallowance made by the Assessing Officer of Rs.3,24,403/- u/s 37(1) of the Act.

5.

After hearing both the parties, we find that the assessee debited Rs.3,42,403/- under the head “directors” Residence Gas & Electricity in its P&L A/c and the same expenses has been accepted in the preceding year by the revenue authorities. We note that the assessee has incurred the expenditure wholly and exclusively for the purpose of business, therefore, the same is allowable expenditure u/s 37(1) of the Act. Ground No.2 is allowed.

6.

Ground No.3 raised by the assessee is against the confirmation of disallowance of deduction u/s 80IC.

7.

After hearing both the parties, we find that the assessee claimed deduction u/s 80IC in respect of profits derived from its eligible industrial undertaking. The Assessing Officer did not consider the claim of the assessee in respect of the disallowance made. The assessee submitted that the said deduction u/s 80IC was allowed in the preceding assessment years and the said deduction was in respect of eligible undertaking. Therefore, the action of the ld. CIT(A) in rejecting the claim by misunderstanding the fact are not sustainable. Consequently, we set aside the order of the ld. CIT(A) on this issue and simultaneously we direct the Assessing Officer to allow the deduction u/s 80IC of the Act. Ground No.3 is allowed.

ITA No.2967/Kol/2025 8. Ground no.4 is general in nature and does not require any adjudication.

9.

In the result, the appeal of the assessee is partly allowed.

Kolkata, the 28th April, 2026.

Sd/- Sd/- [Rajesh Kumar] [Pradip Kumar Choubey] Accountant Member Judicial Member

Dated:. 28.04.2026. DC Copy of the order forwarded to: 1. Appellant - 2. Respondent - 3. CIT(A)- 4. CIT- , 5. CIT(DR),

//True copy// By order Assistant Registrar, Kolkata Benches

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