What did the Tribunal hold?

The Tribunal, following a coordinate bench's decision in a similar case, held that the addition on account of delayed payment of PF & ESI contributions should be deleted. The payments were made before the due date of filing the return.

The Assessing Officer disallowed employee contributions to PF & ESI made after the due date, adding Rs. 24,76,900 to the assessee's income. An additional Rs. 3 lakhs was added for expenditure not supported by vouchers. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether disallowance of employee contributions to PF & ESI made after the statutory due date but before the return filing due date is justified.

M/S Daulataram Engineering… vs ACIT | s.143(3) | ITAT Indore 2018

Income Tax Appellate Tribunal, INDORE BENCH, INDORE

Before: SHRI KUL BHARAT & SHRI MANISH BORAD

For Appellant: Shri S.S. Deshpandey, AR

For Respondent: Shri P.K. Mitra, DR

Hearing: 05.10.2018Pronounced: 12.10.2018

PER KUL BHARAT, J.M: This appeal by the assessee is directed against order of the CIT(A)-1, Bhopal dated 20.4.2017 pertaining to the assessment year 2013-14. The assessee has raised

following grounds of appeal:

Briefly stated facts are that case of the assessee was picked up for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act, 1961 (hereinafter called as ‘the Act’) was carried out vide order dated 18.2.2016. While framing assessment, the A.O. noticed that the assessee has made payment to employees contribution

towards PF & ESI after the due date of payment as provided under the relevant Act and was disallowed this expenditure and made addition of Rs.24,76,900/-. The A.O. further made addition on account of the expenditure

which was not supported by the vouchers amounting to Rs.3 lakhs.

Aggrieved by this, the assessee preferred an appeal before the Ld. CIT(A) who after considering

submissions dismissed the appeal. Now the assessee is in appeal. The only effective ground raised while framing the addition is in respect of disallowance of contribution made

by the employees towards PF & ESI. Ld. Counsel for the assessee reiterated the submissions as made in the written

synopsis which reads as under:

Ld. Counsel for the assessee reiterated the submissions as made in the written synopsis and also submitted that the issue is covered in favour of the assessee as the payments were made before due date of filing of return.

On the contrary, Ld. D.R. opposed the submissions and supported the orders of the authorities

below.

We have heard the rival submissions, perused the materials available on record and gone through the orders

of the authorities below. The Ld. CIT(A) rejected the ground of appeal by observing as under:

On the above order of the Ld. CIT(A) it is evident

that Ld. CIT(A) confirmed the addition on the ground that the payments were made after the due date. Ld. Counsel

for the assessee has relied upon judgement of the Hon'ble Rajasthan High Court rendered in the case of CIT Vs. State

Bank of Bikaner 363 ITR 70 and also the judgement of the Hon'ble Supreme Court in the case of CIT Vs. Alom No.863/Ind/2016 dated 21.6.2017 under the identical

facts after considering the law deleted the addition by observing as under:

Therefore, after taking a consistent view, we direct

the A.O. for the same reasoning to delete the addition.

In the result, the appeal filed by the assessee is allowed.

Order was pronounced in the open court on 12.10.2018. (MANISH BORAD) JUDICIALMEMBER Indore; "दनांक Dated : 12 / 10/2018 VG/SPS Copy to: Assessee/AO/Pr. CIT/ CIT (A)/ITAT (DR)/Guard file.

By order 11

M/S DAULATARAM ENGINEERING SERVICES P.LTD,MANDIDEEP vs. ASSISTANT COMMISSIONER OF INCOME TAX 1 (1), BHOPAL

What did the Tribunal hold?

What were the facts?

What were the issues?

Which sections of the Income-tax Act were involved?

Recent GST High Court judgments