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Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.
Before: DR. M. L. MEENA & SH. ANIKESH BANERJEE
ORDER Per: Anikesh Banerjee, JM: The instant appeal of the assessee was filed against the order of the ld. NFAC, Delhi, (in brevity ‘the CIT (A)’) order passed u/s 250 of the Income-tax Act, 1961 (in brevity the Act) for assessment year 2020-21. The impugned order was emanated from the order of CPC, Bengaluru, (in brevity the AO) order passed u/s 143(1) of the Act.
The appeal of the assessee was filed with delay of 03 days. The assessee filed the petition for condonation of delay. The assessee explained that the delay was caused due to notice issued on portal delay which is beyond the control of 2 Assessment Year: 2020-21 the assessee. The ld. DR had not made any objection against the condonation. Accordingly, the delay for 03 days is condoned.
The assessee has taken the following grounds:
“1. That the order of the Ld. CIT Appeals, National Faceless Assessment Centre, Delhi sustaining an addition of Rs 4,51,294.00/- for non-payment of employees’ share of Employees Provident fund with in due date as provided in the respective statue i.e., u/s Section 36(1 )(va) of the Income Tax Act, 1961 is against the law and the fact of the case and the Ld. CIT(A) had no material in its position to sustain this addition.
2. That the CIT(A) has grossly erred in sustaining an addition of Rs 451294.00/- on the basis of the order issued by Hon'ble Supreme Court of India in the case of Checkmate Services Private Limited as reported under 448 ITR 518 is not applicable to the assesse, since no amount in respect of EPF and ESI is paid beyond the due date as provided under the Law.
3. That the learned CIT (A) has grossly erred in not taking cognizance of the date of payments of EPF and ESI which are duly reported in Revised Tax Audit Report and the evidence of making such payments with in the due dates was furnished along with the written submissions. The payment of ^ 451294.00/- has been made on or before the due date of making such payments as mentioned in the respective act i.e., Employees State Provident Fund and Miscellaneous provisions Act.
Any other ground of appeal which may be urged at the time of hearing of appeal.”
3 Assessment Year: 2020-21
4. Brief fact of the case is that the assessee submitted the tax audit report with the return by claiming that the payment of ESI and PF of employees’ contribution was after the due date as per stipulated in relevant act.The ld. AO had treated this payment as income u/s 2(24) (x) and added back amount to Rs.4,51,294/- u/s 36(1)(va). The return was processed u/s 143(1) on dated 28.10.2021. Aggrieved assessee filed as appeal before the ld. CIT(A). The ld. CIT(A) had completed the appeal and upheld the assessment order after considering the order of Hon’ble Apex Court in the case of Checkmate Services P. Ltd. Vs CIT (Civil Appeal No.2833 of 2016 dated 12.10.2022), [2022] 143 taxmann.com 178 (SC), and disallowed the delayed payment of employees contribution under PF and ESI u/s 36(1)(va). The assessee claimed that the tax audit report was duly wrong and the Auditor placed the wrong data before the revenue in tax audit report. The rectified tax audit report was duly filed before the ld. CIT(A) before completion of appeal but without considering the same the order was passed against the assessee. Being aggrieved assessee filed an appeal before us.
The ld. AR submitted a written submission and argued that the revenue authorities had made a wrong fact related to delayed payment of employees’ contribution in PF and ESI. The tax audit report was filed with the return was duly stated the wrong fact and accordingly, the addition was made. The ld.AR further mentioned that the assessee paid all the amount within due time and revised tax audit report was filed before the ld. CIT(A) before completion of 4 Assessment Year: 2020-21 appeal. Copy of the tax audit report dated 21.01.2023 duly audited by Sh. P.P. Arora Associates, CA is annexed with APB 1 to 19 which was placed before the ld. Appellate Authority.
5.1 The ld. AR invited our attention on details of payment in APB page 8 which is extracted as below:
“Details of contributions received from employees for various funds
Nature of fund Sum received from Due date for The actual amount employees payment paid The actual date of payment to the concerned authorities Provident Fund 456980 15/03/2020 456980 14/03/2020 Provident Fund 453890 15/02/2020 453890 15/02/2020 Provident Fund 462987 15/01/2020 462987 15/01/2020 Provident Fund 473408 15/12/2019 473408 14/12/2019 Provident Fund 472874 15/11/2019 472874 15/11/2019 Provident Fund 474780 15/10/2019 474780 15/10/2019 Provident Fund 530188 15/09/2019 530188 15/09/2019 Provident Fund 546703 15/08/2019 546703 15/08/2019 Provident Fund 543741 15/07/2019 543741 15/07/2019 Provident Fund 547640 15/06/2019 547640 15/06/2019 Provident Fund 554226 15/05/2.019 554226 15/05/2019 Provident Fund 451294 15/04/2020 451294 15/04/2020 as referred to in section 36(1 )(va):”
5.2 The ld. AR argued that all the challans as proof of payments are duly annexed in APB page nos. 20 to 22. So, he humbly prayed that the order of the Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd. (supra) will not be applicable in assessee’s case. The ld. AR further informed that the assessee had not filed the documents as additional evidence under Rule 46A 5 Assessment Year: 2020-21 before the ld. CIT(A). Before completion of the order the documents are submitted but the ld. CIT(A) had not taken any cognizance of these documents.
The ld. AR prayed for acceptance of the documents before the bench.
The ld. DR vehemently argued and fully relied on the order of the revenue authority.
We heard the rival submission and consider documents available in records. The assessee made a wrong statement before the revenue authorities related to delayed payment of employees’ contribution in PF and ESI. But in any case, the tax audit report was duly revised and submitted before the revenue authorities before completion of the appeal proceeding. The ld. CIT(A) had not taken any cognisance of this documents before passing this order. The revised tax audit report supported with the challans which are duly submitted and are taken in the appeal record. The ld. DR had not made any objection about the relied upon documents of the assessee. In our considered view, the assessee should get a reasonable opportunity for submitting its documents as all the payments are showing was duly executed within due date as per the stipulated time in respective acts. Accordingly, we set aside the issue to the ld. AO for verification of the documents of the assessee on the above-mentioned issue and allow a speaking order against the assessee’s claim. Needless to say, that the AO shall provide proper and adequate opportunity of being heard to the assessee in set aside proceedings. The evidence/explanations submitted by the assessee in 6 Assessment Year: 2020-21 its defence shall be admitted by AO, and adjudicated by AO on merits in accordance with law. We order accordingly.
In the result, the appeal of the assessee bearing is 8. allowed for statistical purposes.
Order pronounced in the open court on 07.08.2023