SPARK AUTOMETAL COMP P LTD,SATARA vs. CPC, BENGALURU

This appeal by the assessee against the order dated 18-08-2021 passed by the National Faceless Appeal Centre, Delhi (‘NFAC’) for assessment year 2019-20.

We find that this appeal was filed with a delay of 01 day. Upon hearing both the parties, we find that the reasons explained by the assessee are bonafide which really prevented the assessee to file the appeal in time. Therefore, the delay of 01 day is condoned.

The only issue is to be decided is as to whether the NFAC is justified in confirming the disallowance made by the CPC on account of PF/ESI in the facts and circumstances of the case.

We note that the CPC, Bengaluru passed order u/s. 143(1) of the Act proposed the adjustment of Rs.1,40,048/- on account of PF/ESI being the payments made after the due date. We note that the NFAC by following the amendment made by Finance Act, 2021 to section 36(1)(va) of the Act found the submissions of assessee regarding deposit of employees contribution before the due date of filing return of income not acceptable. We note that the said amendment is applicable from 1st April, 2021 and since the assessment under consideration is A.Y. 2019-20, the amendment is not applicable on the facts in hand. There is no dispute by the NFAC about the payment of PF/ESI contribution before the due date of filing of return of income. Therefore, the impugned passed by the NFAC is not justified and the assessee is entitled to get deduction. Thus, the grounds raised by the assessee are allowed.

In the result, the appeal of assessee is allowed.