VISHWAS CO-OP. BANK LTD.,NASHIK vs. ACIT, CIRCLE 1,, NASHIK

This is an appeal filed by the assessee directed against the order of the CIT(A) dated 19.02.2024 for the assessment year 2018-19.

Briefly, the facts of the case are that the assessee is a Cooperative Bank engaged in the business of Banking. It filed the Return of Income for the A.Y. 2018-19 was filed on 06.10.2018 declaring income of Rs.3,99,60,330/-. The said return of income was processed by the CPC u/s.143(1) vide intimation dated 16.10.2019 after making adjustment on account of delayed remittance of PF/ESI contribution of Rs.8,20,840/- by holding that contribution to PF/ESI was paid beyond the due date prescribed under the respective Acts.

Being aggrieved, an appeal was by the assessee bank filed before the CIT(A) who vide impugned order confirmed the action of the CPC.

Being aggrieved, the assessee is in appeal before the Tribunal in the present appeal.

The ld. Authorised Representative submits before us that in the Tax Audit Report due date of remittance was wrongly mentioned. Actually the PF/ESI contributions were remitted before the due date prescribed under the respective Act and therefore, no disallowance u/s.143(1) can be made.

On the other hand, the ld. Departmental Representative submits that the ratio of judgment of the Hon’ble Supreme Court in the case of Checkmate Services P. Ltd. & Ors. vs. CIT & Ors. (2022) 448 ITR 518 (SC) is squarely applicable and therefore, no interference by this Tribunal is called for.

We heard the rival submissions and perused the material on record. The only issue that arises for our determination is whether the CPC was justified in making adjustment of amount of employees’ contribution to PF/ESI for belated remittance. It is an undisputed that the Tax Audit Report contains information that there was delay in remittances of the contribution of PF/ESI under respective Acts.

The power of adjustment under sub-clause (a) of sub-section (1) of section 143 is summary in nature empowering to make adjustments which are apparent from the return of income under clause (a) of sub- section (1) of section 143. This sub-clause specifies the kinds of adjustments which are required to be made for computing the total income or loss. Under sub-clause (ii) of clause (a) of sub-section (1) of section 143, the adjustment of an incorrect claim, if it is apparent from any information in the return of income can be made. Explanation appended to sub-clause (ii) of clause (a) to section 143(1) explains the meaning of ‘incorrect claim’ apparent from any information in the return of income to mean that information which is required to be furnished in the Act to substantiate an entry which had not been furnished.

The issue in the present case fall under the category of incorrect claim as defined under Explanation to section 143(1)(a)(ii) of the Act. Therefore, the CPC was justified in making prima-facie adjustment as confirmed by the CIT(A). The contention that the information contained in the Tax Audit Report with regard to the due date for remittance of PF/ESI cannot be accepted for the reasons that this plea was taken for the first time before this Tribunal and also the CPC while processing the return of income cannot travel beyond the return of income and accompanying documents. Thus, the appeal filed by the assessee has no merit, accordingly dismissed.

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