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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: HON’BLE SHRI SATBEER SINGH GODARA, J.M & HON’BLE SHRI MANOJ KUMAR AGGARWAL, A.M
आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2014-15 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 26-08-2021 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s.143(3) of the Act on 02-12-2016.
2 - 2. The Ld. AR advanced arguments supporting the case of the assessee. The Ld. Sr. DR has controverted the arguments of Ld. AR. Having heard rival submissions, the appeal is disposed-off as under.
The first issue in the appeal is disallowance u/s 36(1)(va) for Rs.72,035/- which has been made on account of late payment of employee’s contribution to PF / ESI by the assessee. This issue is now covered against the assessee by the recent decision of Hon’ble Supreme Court in bunch of appeals titled as Checkmate Services P. Ltd. Vs CIT (Civil Appeal No.2833 of 2016 dated 12.10.2022). Respectfully following the same, this ground is dismissed.
3. The second ground is disallowance of interest of Rs.26,449/- as paid by the assessee u/s 201(1A) on account of late deposit of TDS. We find that this issue stand decided in assessee’s favor by the decision of Hon’ble Karnataka High Court in CIT vs. Oriental Insurance Co. Ltd. (315 ITR 102) which has held that such interest is not penal in nature. Respectfully following the same, we delete the impugned disallowance.
The last ground urged in the appeal is disallowance of provision for advances for Rs.4,30,325/-. Before lower authorities, the assessee has submitted that the provision has been reduced from advances and only net amount has been shown on asset side of the Balance Sheet and therefore, the same would amount to write-off as per the decision of Hon’ble Supreme Court in the case of Vijaya Bank (323 ITR 166). However, Ld. CIT(A) confirmed this disallowance. We find that similar issue, under similar factual matrix, has been decided by Cochin Tribunal in assessee’s favor in the case of Hi-Build Coatings Pvt. Ltd. vs. Addl. CIT (ITA No.310/Coch/2014 order dated 19.09.2014)
3 - wherein the Bench has chosen to follow the cited decision of Hon’ble Apex Court and held that when the amount was reduced from loans and advances, it shall be allowed as deduction u/s 36(1)(vii). Following the same, this issue is decided in assessee’s favor. 5. The appeal stands partly allowed.
Order pronounced on 30th November, 2022.