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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM
Before: SHRI DUVVURU RL REDDY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE
अपीलधथी की ओर से/ Appellant by : Shri G.V.N.Hari, AR प्रत्यधथी की ओर से / Respondent by : Shri Madhukar Aves, DR सुनवधई की तधरीख / Date of Hearing : 10.10.2023 घोर्णध की तधरीख/Date of Pronouncement : 06.11.2023 आदेश /O R D E R Per Shri Duvvuru RL Reddy, Judicial Member :
This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi vide DIN & Order No.ITBA/NFAC/S/250/2021-22/1034565788(1) dated 02.08.2021, arising out of assessment order passed u/s 143(1) of the Income Tax Act, 1961 (in short ‘Act’) dated 07.07.2020 for the Assessment Year (A.Y.)
Srinivasa Rao Bathina., Visakhapatnam 2019-20 with the delay of 237 days. The assessee filed a petition submitting that as per the orders dated 23.03.2020, 27.04.2021, 23.09.2021 and 10.01.2022 of the Hon’ble Supreme Court in SMW(A) No.3 of 2020, the period of limitation for filing appeals under general laws and all special laws falling between 15.03.2020 and 28.02.2022 shall be excluded for calculating the delay. He further submitted that in the order dated 10.01.2022 of the Hon’ble Supreme Court it is also provided that all persons shall have further grace period of 90 days from 01.03.2022 onwards. The assessee further submitted that since the appeal filed falls within the period of limitation provided in the said orders of the Hon’ble Supreme Court, there is no delay in filing the appeal. We have heard the Ld.AR and gone through the petition filed. The appeal ought to have been filed on or before 01.10.2021 against the order of the Ld.CIT(A) served on the assessee on 02.08.2021. But the assessee could file appeal only on 26.05.222 with the delay of 237 days. The assessee filed note on limitation and pleaded to condone the delay. Since the delay in filing the appeal is covered in the period of limitation as per the orders of the Hon’ble Supreme Court in SMW(A) No3 of 2020, we are inclined to condone the delay and admit the appeal for adjudication.
Srinivasa Rao Bathina., Visakhapatnam
Brief facts of the case are that the assessee, filed his return of income on 25.10.2019 for the A.Y.2019-20, admitting total income at Rs.52,65,570/-. However, the Centralized Processing Centre (CPC) had processed the return of income and intimation u/s 143(1) was issued on 07.07.2020 determining the income at Rs.,59,26,950/- towards delayed remittance of employees contribution of EPF and ESI of Rs.6,61,379/- paid beyond the due dates prescribed under the respective Acts.
Aggrieved by the order of the CPC, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) dismissed the appeal of the assessee.
Aggrieved by the order of the Ld.CIT(A), the assessee preferred an appeal before the Tribunal by raising the following grounds of appeal :
The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case.
2. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the adjustment of a total sum of Rs.6,61,379 made in the limitation u/s 143(1) of the Act towards disallowance of delayed remittance of Employees’ contribution to PF and ESI. 3. The learned Commissioner of Income Tax (Appeals) ought to have considered that the disallowance is not warranted in as much as the Employees’ contribution to PF and ESI were remitted before the due date of filing the return of income u/s 139(1) of the Act. 4. The learned Commissioner of Income Tax(Appeals) ought to have considered that the amendments made by Finance Act, 2021 Srinivasa Rao Bathina., Visakhapatnam to S.36(1)(va) and S.43B are applicable w.e.f. 01.04.2021 and do not apply for the year under consideration. 5. Any other grounds may be urged at the time of hearing.
All the grounds of appeal are related to disallowance of deposits made by the assessee towards PF / ESI before the due date of filing the return of income u/s 139(1) of the Act. The Ld.AR contended that though the same could not be paid within the due dates specified under PF Act and ESI Act, the same were remitted before the due date of filing the return of income u/s 139(1) of the Act. The Ld.AR further contended that the amendments made by Finance Act, 2021 to S.36(1)(va) and S.43B are applicable w.e.f. 0.04.2021 and do not apply for the year under consideration. He, therefore, pleaded to set aside the order passed by the Ld.CIT(A) and allow the appeal of the assessee.
The Ld.DR relied on the order of the Ld.CIT(A) and pleaded to uphold the order passed by the Ld.CIT(A) and dismiss the appeal filed by the assessee.
We have heard the Ld.DR and perused the material available on record. Now the law is settled after a view had been taken by Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd., in Civil Appeal No.2833 of 2016, order dated 12.10.2022. In the case on hand also, the Srinivasa Rao Bathina., Visakhapatnam assessee made remittances before filing the return of income u/s 139(1), but not within the due date specified by the respective PF / ESI Acts. For the sake of clarity and convenience, relevant part of the order of the Checkmate Services Pvt. Ltd.(supra) is extracted as under : “They have to be deposited in terms of such welfare enactments. It is upon deposit, in terms of those enactments and on or before the due dates mandated by such concerned law, that the amount which is otherwise retained, and deemed an income is treated as a deduction. Thus, it is an essential condition for deduction that such amounts are deposited on or before the due date.” Since the decision of the Hon’ble Supreme Court pronounced the correct legal position of the allowability of belated payment of PF and ESI under the provisions of the Act, we have no hesitation to come to a conclusion that the disallowance made by the AO as well as the Ld.CIT(A) needs no interference, in view of the decision of the Hon’ble Supreme Court mentioned supra.
In the result, appeal of the assessee is dismissed.
Order pronounced in the open court on 6th November, 2023. (एस बालाकृष्णन) (दुव्वूरु आर.एल रेड्डी) (S.BALAKRISHNAN) (DUVVURU RL REDDY) लेखा सदस्य/ACCOUNTANT MEMBER न्याधयक सदस्य/JUDICIAL MEMBER Dated : 06.11.2023 L.Rama, SPS