BHAGWAN PRECISION PRIVATE LIMITED,ROHTAK V. ASSISSTANT COMMISSIONER OF INCOME TAX, ROHTAK

ITA 2494/DEL/2024

AI Insights

The case involves Bhagwan Precision Pvt. Ltd., the appellant, contesting an order from the Commissioner of Income Tax (Appeals) which upheld the disallowance of Rs. 3,03,188. This amount was claimed as contributions received from employees towards Provident Fund and ESI, which the Assessing Officer initially disallowed. The appellant argued that the contributions were indeed made within the prescribed deadlines but were mistakenly not reported correctly in the audit report due to an oversight by the Chartered Accountant. The tribunal, referencing the Supreme Court's decision in Checkmate Services (P) Ltd. vs. CIT, found merit in the appellant's plea for a re-examination of the timing of the contributions and remanded the case for further verification.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 31029 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2021-2022
• Other Referred Cases: Checkmate Services (P) Ltd. vs. CIT (2022) 143 taxmann.com 178 (SC)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT KATOCH
• Assessee Lawyers: ARUN KR. JAIN; NOT ALLOWING; MAKING ADJUSTMENT OF RS.

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: ‘A’: NEW DELHI) BEFORE SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI SUDHIR PAREEK, JUDICIAL MEMBER ITA No:- 2494/Del/2024 (Assessment Year- 2021-22) Bhagwan Precision Pvt. Ltd., Rohtak. Vs. Assistant Commissioner of Income Tax, Rohtak. PAN No: AADCB1115D APPELLANT RESPONDENT Assessee by : Shri Arun Kr. Jain, CA Revenue by : Shri Amit Katoch, Sr. DR Date of Hearing : 27.12.2024 Date of Pronouncement : 29.01.2025 ORDER PER SUDHIR PAREEK, JM This appeal is filed by the Assessee is directed against the order dated 21.03.2024 of the Ld. Commissioner of Income Tax (Appeals), ADDL / JCIT (A)-2, Kolkata [hereinafter referred to as “Ld. CIT(A)] pertaining to Assessment Year 2021-22. ITA No.-2494/Del/2024 Bhagwan Precision P. Ltd. Page 2 of 5 1.1 The assessee has raised the following grounds of appeal: “1. The order of the ld. Addl/JCIT(A)-2, Kolkata is against facts and is bad in law. 2. The ld. Addl/JCIT(A) has erred in dismissing the appeal of the appellant by not allowing and making adjustment of Rs. 3,03,188/- of the sum received from employees as contribution to any Provident Fund, ESI to the extent not credited to the employees account on or before the due date [36(1)va] claimed in the return of Income in Schedule 01 and Audit Report. 3. The ld. AddI/JCIT(A) has erred in not considering the submissions made by the appellant regarding payment of Provident Fund and ESI made within the prescribed time under the respective Acts. The payments of PF and ESI were made within the due dates, but by mistake the Chartered Accountant did not mention the actual amount paid in the column in Form 3CD of the Audit Report. 4. The appellant craves leave to add, amend, alter or forgo any ground of appeal at the time of hearing.” 2. The brief facts of the case are that the appellant is engaged in the business of manufacturing of precision turned parts. The appellant company filed its return of income for the assessment year 2021-22 declaring an income of Rs. 2,49,87,110/- on 21.02.2022 vide e-filing. The appellant in the return had claimed a sum of Rs. 3,03,188/- as contribution received from Employees Provident Fund and under ESI the Ld. AO disallowed this amount. 3. Against it, appeal filed by assessee, dismissed by the Ld. CIT(A) vide impugned order. 4. Heard rival submissions and carefully perused the material on record. ITA No.-2494/Del/2024 Bhagwan Precision P. Ltd. Page 3 of 5 5. The Ld. AR submitted that the amounts were duly deposited into the employees account before the deadlines. But due to oversight it was not shown in the original Audit Report. The Audit report has now been revised after mentioning the actual amount paid. The amount of contribution has been paid to the accounts of the employees within the due time. 6. Per contra, the Ld. DR relied upon the orders passed by both the lower authorities. 7. The Ld. AR expressed that his submission was not considered properly regarding payment of PF and ESI made within the prescribed time limit but by mistake the CA did not mention the actual amount paid in the column in form 3CD of the audit report, which now been revised after mentioning the actual amount apid and amount of the said calculation has been paid to the accounts of the employees within due time. In this context, the issue towards taxability of belated employees’ contribution to Provident Fund / ESI is no longer res integra in the light of the judgment passed by the Hon’ble Apex Court in the case of Checkmate Services (P) Ltd. vs. CIT (2022) 143 taxmann.com 178 (SC). But in the matter in hand, the assessee / appellant contended that he paid the same within the ITA No.-2494/Del/2024 Bhagwan Precision P. Ltd. Page 4 of 5 prescribed time limit and due to certain mistake did not reflected in the column in form 3CD and for which he revised the audit report, and in such a plea proper verification is required, so in the fact situation mentioned hereinbefore, without expressing the merit of the case, we find it expedient to restore the issue back to the file of the Ld.AO for verification and redetermination in the issue, with the direction to recomputed the amount of disallowance u/s 36(i)(v)(a) of the Act, in accordance with law. The assessee / appellant shall be entitled to appropriate relief u/s 36(i)(v)(a) of the Act, if it is found that deposits have been made towards PF / ESI with the statutory limit / due date from the close of month of actual disbursement of salary / wages. 8. Consequently, appeal of assessee / appellant is allowed as indicated above. Order pronounced in the Open Court on 29.01.2025 Sd/- Sd/- (S RIFAUR RAHMAN) (SUDHIR PAREEK) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 29/01/2025. Pooja/- ITA No.-2494/Del/2024 Bhagwan Precision P. Ltd. Page 5 of 5 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 1. Date of dictation of Tribunal order 28.01.25 2. Date on which the typed draft Tribunal Order is placed before the Dictating Member 28.01.25 3. Date on which the typed draft Tribunal order is placed before the other Member 4. Date on which the approved draft Tribunal order comes to the Sr. PS/PS 5. Date on which the fair Tribunal order is placed before the Dictating Member for pronouncement 6. Date on which the signed order comes back to the Sr.PS/PS 7. Date on which the final Tribunal order is uploaded by the Sr.PS/PS on official website 8. Date on which the file goes to the Bench Clerk alongwith Tribunal order 9 Date of killing off the disposed of files on the judisis Portal of ITAT by the Bench Clerks 10. Date on which the file goes to the Supervisor (Judicial) 11. The date on which the file goes to the Assistant Registrar for endorsement of the order 12. Date of Despatch of the order "