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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM
आदेश / O R D E R PER DR. A. L. SAINI, AM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2020-21, is directed against the order passed by the Learned Commissioner of Income Tax (Appeals), [in short “the ld. CIT(A)”], National Faceless Appeal Centre (in short ‘the NFAC’), Delhi, which in turn arises out of an assessment order passed by Assessing Officer under section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”). 2. The grounds of appeal
raised by the assessee are as follows: “1. Ld. CIT(A) has erred and was not just and proper on the facts of the case and in law in confirming disallowance despite payment before due date of respective statute.”
3. At the outset, Ld. Counsel for the assessee submitted that in the following cases, there is no delay in the depositing Employees Provident Funds and ESIC (in short ‘the PF & ESIC). Therefore, suitable instruction may be given to the Assessing Officer to verify the details and documents to allow the claim of the assessee.
NOTE 1 “The period of the captioned amount of Rs.2,09,824/- was the PEAK of the PANDEMIC CORONA. All around were under LOCKDOWN. The PF department had extended the date of deposit up to 15/05/2020. Copy of the circular is enclosed herewith (ANN “A”). Thereafter considering the severity of the CORONA PANDEMIC, the department had decided not to levy any PENALTY and vide circular dated 15/05/2020. The copy of the said circular is enclosed herewith (ANN “B”). It was observed that – “Thus, the delay in deposit of contributions during the period of lockdown announced in terms of the Disasters Management Act, 2005 cannot be attributed to any culpable state of mind of the employer and will not, therefore attract the provisions of section 14B of the EPF Act. Therefore, for any delay in payment of any contributions or administrative charges due for any period during the lockdown, no proceeding should be initiated for levy of penal damages in such cases.” The Hon'ble Supreme Court vide order dated 10/01/2022 (Copy enclosed at page no. 57 of PB) had stated – “In March, 2020, this court took upto suo motu cognizance of the difficulties that might be faced by litigants in filing petitions/applications/suits/appeals/all other quasi proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and/or State) due to outbreak of the COVID-19 pandemic.” The Hon'ble Supreme Court extended the limitations up to 28.02.2022 by various orders. In the light of the above, it is submitted that the delay of 14 days in depositing the sum may kindly be condoned keeping in mind the genuine and forced difficulties of PANDEMIC.”
Aklavya Industries P. Ltd. 4. Therefore, Ld. Counsel contended that in cases, as mentioned in the table above, there is no delay in depositing Employees PF and ESIC, therefore to that extent the addition made by the Assessing Officer may be deleted.
On the other hand, Learned Departmental Representative (Ld. DR) for the Revenue submitted that the details/ chart submitted by the assessee should be sent to the Assessing Officer for verification, and the Assessing Officer may also claim of the assessee after verification, in accordance with law.
We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(A) and other material brought on record. We note that before ld CIT(A), assessee has raised the grounds stating that assessing officer was wrong in making disallowance u/s 36(1)(va) of the Act to the tune of Rs.7,10,126/- and u/s 43B at Rs.2,68,197/-. However, ld CIT(A) dismissed the appeal of the assessee by following the recent judgment of Hon`ble Supreme Court in the case of Checkmate Services Pvt Ltd, 143 taxmann.com178(SC). Aggrieved by the order of ld CIT(A), the assessee is in further appeal before us.
Before us, Ld. Counsel submitted a chart showing the PF and ESIC deposited on or before the due date mentioned in the Employees Provident Fund Act (EPF Act), which is reproduced by us in para 3 of this order. We have gone through the above chart and noted that in the case of few instances narrated in the above Chart, there is no delay in depositing employees PF and ESIC to the concerned funds and assessee has submitted the above details for verification of his claim. We observe that the amount of PF and ESIC mentioned in the above chart, viz. Rs.2,40,383/- and Rs.16,995/- PF and ESI respectively, have been deposited by the assessee on or before the due date on 15.02.2020, therefore we are of the view that assessee is entitled to claim deduction, therefore, we remit these two figures (Rs.2,40,383/- and Rs.16,995/-) to the file of the assessing
Aklavya Industries P. Ltd. officer, with the direction to the assessing officer to verify these two figures and allow the claim of the assessee in accordance with law.
About the employees PF of Rs.2,09,824/-, as mentioned in the above chart, we note that due date for deposit the said amount was 15.05.2020, and the assessee paid the same on 29.05.2020, hence there is delay of 14 days in depositing the said PF.
At this juncture, the Ld. Counsel for the assessee, has heavily relied on the judgment of the Hon'ble Supreme Court in suo motu Writ Petition No.3 of 2020, dated 10.01.2022, wherein the Hon'ble Supreme Court directed extension of the period of limitation in all proceedings before courts/Tribunals and all judicial or quasi-judicial proceedings. Therefore, this judgment of the Hon'ble Supreme Court is for condonation of delay in filing appeals and petitions, and not for condonation of delay in depositing PF and ESIC. Therefore, in our opinion this judgment of Hon'ble Supreme Court does not assist the assessee.
The employees’ Provident Fund organization has issued a circular dated 15.04.2020 wherein due date was extended for payment of contribution from 15.04.2020 to 15.05.2020 and ld Counsel relied on the said circular and argued that date was extended by employees’ Provident Fund organization, therefore, assessee is entitled to claim deduction of Rs.2,09,824/-, even if there is delay of 14 days, as severe COVID-19 disease was going on, therefore assessee was not in a position to deposit the said amount on or before extended period, up to 15.05.2020.
We note that said circular is applicable to the assessee, provided the due date for payment of contribution falls within such extension period (15.04.2020 to 15.05.2020), then in that case the assessee would be entitled to get the benefit. We note that assessee deposited employees’ Provident Fund at Rs.2,09,824/- on 29.05.2020, hence there is delay of 14 days in depositing the said amount, as it does not fall within the extended period up to 15.05.2020, hence assessee under consideration is not eligible to get benefit of the Circular dated 15.04.2020.
Aklavya Industries P. Ltd. Therefore, we disallow the claim of the assessee for employees PF to the tune of Rs.2,09,824/-.
In the result, appeal filed by the assessee is partly allowed for statistical purposes, in above terms.
Order pronounced on 30/05/2023 in the open court.