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Income Tax Appellate Tribunal, JAIPUR BENCHES,”SMC” JAIPUR
Before: SHRI RATHOD KAMLESH JAYANTBHAI, AM & SHRI NARINDER KUMAR, JM vk;dj vihy la-@ITA No. 333/JPR/2022
vkns'k@ORDER PER: Narinder Kumar, Judicial Member, Present appeal came to be presented on 29.08.2022, challenging order dated 14.09.2021, passed by Learned CIT(A), NFAC, Delhi u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), as thereby the appeal filed by the assessee against intimation order dated 19.12.2019 u/s 143(1) of the Act was dismissed, while confirming the intimation order.
R.K. Electricals vs. DCIT 2. It may be mentioned here that earlier on 18.10.2022, present appeal filed by the assessee before this Appellate Tribunal was allowed and the addition made by way of adjustment, to the tune of Rs. 4,79,558/-, made by the CPC was deleted. Said addition by way of adjustment was made by the CPC due to late deposit of amounts of Employees contribution towards Provident Fund. Subsequently, Revenue filed an application for rectification of the above said order dated 18.10.2022. Said application came to be registered as MA No. 43/JPR/2023. Vide order dated 22.08.2024, MA No. 43/JPR/2023 was allowed by observing in the manner as under:- “2.6 The Bench has heard the ld. DR and also taken into consideration the contents of the Misc. Application wherein the Department has put thrust on the order of the Honble Supreme Court in the matter of applicability of Section 36(1)(va) of the Act in the case of Checkmate Services Pvt. Ltd. vsd CIT-1 in Civil Appeal No. 2833/2026 dated 12-10-2022 wherein the Hon’ble Supreme Court dismissed the appeal of the assessee company with an observation that ‘’the distinction between an employer’s contribution which is its primary liability under law in terms of section 36(1)(iv) as its liability to deposit amounts received by it or deducted by it (section 36(1(va), is thus crucial. Thus it is an essential condition for the deduction that such amounts are deposited on or before the due date. If such interpretation were to be adopted, the non-obstante clause under section 43B or anything contained in that provision would not absolve the assessee from its liability to deposit the employee’s contribution on or before the due date as condition for deduction. The Hon'ble Supreme Court in this order held that held that "the contribution by the employees to the relevant funds is the employer's income u/s 2(24)(x) of the Act and the deduction for the same can be allowed only if such amount is deposited in the employee's account in the relevant fund before the date stipulated under the respective Acts. Thus the R.K. Electricals vs. DCIT deduction u/s 36(1)(va) of the Act can be allowed only if the employees' share in the relevant funds is deposited by the employer before the due date stipulated in respective Acts". In this case, it is noteworthy to mention that the appeal of the assessee was heard on 20-09-2022 and the Bench simultaneously considered the written submission dated 07-09-2022 filed by the ld. Counsel of the assessee but the ld. DR has not raised the decision of Hon’ble Supreme Court in the case of Checkmate Services (P) Ltd. as it was pronounced on 12-10-2022. Hence, in this view of the matter, the Bench now feels that the decision delivered by Hon’ble Supreme Court in the case of Checkmate Services (P) Ltd. is applicable in the present case. Accordingly, the bench recalls its order dated 18-10-2022 and direct the Registry to fix the appeal for hearing in regular course. Thus the Misc. Application of the Department is allowed. 4.0 In the result, the Misc. Application filed by the Department is allowed.”
After restoration of the appeal to its original number, notices were issued to the assessee-appellant , but none appeared to represent the appellant in this appeal. Even today, none has appeared on behalf of the appellant despite wait. Arguments have been advanced by Ld. DR for the Revenue. Arguments heard. File perused. Discussion 4. Assessee-appellant claims itself to be a firm. On 15.10.2018, the assessee filed income tax return for the assessment year 2018-19, Assessment came to be completed on 22.08.2019, after disallowing Employees provident fund- contributions to the tune of Rs. 4,79,558/- made by the assessee. The assessee is said to have filed rectification u/s 154 of the Act, but could not get any respite.
R.K. Electricals vs. DCIT 5. Intimation order u/s 143(1) of the Act is of 22.08.2019. Feeling aggrieved by the aforesaid disallowance, the assessee presented appeal raising the only ground that the subject payments were made by the assessee on or before filing of the Income Tax Return, and as such, it was entitled to deductions.
Learned CIT(A) dismissed the appeal filed by the assessee, while observing that the ground put forth by the appellant that EPF payments were made on or before filing of the ITR, was not acceptable, the reason being that the Employees contribution falls u/s 36(1) (va) of the Act, and such contribution is required to be made as per due date under the relevant Act.
Ld. DR for the Revenue has referred to the provisions of section 36(1) (va) of the Act, and also to the decision in case of Checkmate Services Pvt. Ltd. vs. CIT-1, Civil Appeal No. 2833/2016 dated 12.10.2022, and contended that the assessee, being the employer, was required to deposit Employees contribution towards EPF before the due date as prescribed under Section 36(1) (va) of the Act r.w.s. 2(24)(x) of the Act, and not before filing of the return of income u/s 36(1)(v) of the Act. Ld. DR for the Revenue has further contended that in this matter, the assessee employer having not deposited the Employees contribution amounts before R.K. Electricals vs. DCIT due date as per provisions of section 36(1)(va) r.w.s. 2(24)(x) of the Act, this appeal deserves to be dismissed.
Section 36(1)(va) of the Act reads as under:- “[ any sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 apply, if such sum is credited by the assessee to the employee's account in the relevant fund or funds on or before the due date. [ Inserted by Act 11 of 1987, Section 9 (w.e.f. 1.4.1988).]”
Ld. DR for the Revenue has drawn our attention to the details regarding deposit of EPF by the assessee for the financial year 2017-18, corresponding to the assessment year under consideration, and pointed out that in the said statement, the assessee has depicted the due date of deposit of contribution of the employees with actual date of deposit. Ld. DR has contended that since the said amounts of contribution of the employees towards EPF were not deposited on the due date depicted therein, Learned CIT(A) rightly upheld the intimation order.
Having gone through the above said statement submitted by the assessee itself, giving details of the contributions of the employee towards EPF, with their due dates and actual dates of deposit, we find merit in the submission put forth by Ld. DR for the Revenue that various amounts depicted therein were deposited by the assessee, after due dates.