DCIT, CIRCLE- 23(2), NEW DELHI V. SKYTECH CONSTRUCTIONS PVT. LTD., DELHI

ITA 5824/DEL/2017

AI Insights

The case involves the Deputy Commissioner of Income Tax (DCIT) as the appellant and Skytech Constructions Pvt. Ltd. as the respondent. The primary dispute centered on the deletions made by the Commissioner of Income Tax (Appeals) - 30, New Delhi, concerning various additions made by the Assessing Officer for the Assessment Year 2014-15. The additions included amounts related to bad debts, discounts, interest payments, and issues under Section 68 of the Income Tax Act. The Tribunal's decision addressed the legality of the CIT(A)'s remand to the Assessing Officer and the substantive issues of the additions made.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 23040 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2014-2015
• Other Referred Cases: Checkmate Services Pvt. Ltd. vs. CIT-1
• Laws Referred To: Income Tax Act, 1961, CBDT Circular No. 22/2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JAYA CHAUDHARY
• Assessee Lawyers: RAKESH TIWARI; SANTOSH

Judgement Text

" 1 ITA No.5824/Del/2-017 DCIT Vs. Skytech Constructions Pvt. Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI (DELHI BENCH ‘G’ NEW DELHI BEFORE SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER ITA No. 5824/DEL/2017 (A.Y. 2014-15) DCIT Circle-23(2) Room No. 185A, C. R. Building, New Delhi Vs. Skytech Constructions Pvt. Ltd. 385, Kohat Enclave, Pitampura, Delhi PAN: AAICS5940A Appellant Respondent Assessee by Shri Rakesh Tiwari, CA & Sh. Santosh Pathak, Adv Revenue by Ms. Jaya Chaudhary, CIT(DR) Date of Hearing 03/03/2025 Date of Pronouncement 06/03/2025 ORDER PER YOGESH KUMAR, U.S. JM: The present appeal is filed by the Assessee against the order of the Commissioner of Income Tax (Appeals)-30, [‘Ld. CIT(A)’ for short]- New Delhi dated 21/06/2017for the Assessment Year 2014-15. 2. The grounds of Appeal are as under:- “1. The Ld. CIT (A) erred in facts and in law by deleting the addition of Rs.48,302/ made by the A.O. on the ground that the assessee failed to deposit employees contribution of ESI & PF on time as the same is not allowable as deduction, under 2 ITA No.5824/Del/2-017 DCIT Vs. Skytech Constructions Pvt. Ltd. the provisions of Section 36(1)(va) of the 1. T Act, 1961 r ad with CBDT Circular No. 22/2015 dated 17-12-2015.\" 2. The Ld. C/T (A) erred in deleting the addition of Rs.21 lac on account of bad debt written off, Rs.1,55,000/- on account of discount paid to customer. Rs. 19,18,15,358/ on account of Interest paid to various agencies and Rs.2.16,00,000/- u/s 68 of the Act made by the Assessing Officer: (i) by admitting the additional grounds raised and additior.al evidences produced by the assessee during the course of appellate proceedings in contravention to Sub-rule 1 of Rule 46A of T. Rules, 1962, which provides the conditions failing which no additional /documents shall be admitted. ii) by taking into account and relying on the additional evidences produced by the assessee during the course of appellate proceedings in contravention to Sub-rule 3 of Rule 46A of 1.T Rules, 1962.\" 3. The appellant craves leave to add, alter or amend any of the ground(s) of - appeal before or during the course of hearing of the appeal.\" 3. The first grievance of the Department is that the Ld. CIT(A) committed error in deleting the addition of Rs. 48,302/- made by the A.O. on the ground that the Assessee failed to deposit the Employees Contribution of ESI and PF on time. 4. The Ld. Departmental Representative canvassing on the Ground No. 1 of the Appeal submitted that the issue of late payment of ESI and PF is no more res-integra and by relying on the Judgment of Hon'ble Supreme Court in the case of Checkmate Services Pvt. Ltd. vs. CIT-1 in 3 ITA No.5824/Del/2-017 DCIT Vs. Skytech Constructions Pvt. Ltd. Civil Appeal No. 2833 of 2016, order dated 12/10/2022, sought for allowing the Ground No. 1. 4. The Ld. Assessee's Representative has also agreed with the submission of the Ld. Departmental Representative on Ground No.1 of the Revenue. 5. In view of settled position of law by the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd.(supra), wherein the issue of delayed deposit of employees' share of contributions towards ESIC and EPF by the Assessee beyond the due dates prescribed under the respective Acts held to be not allowable. Accordingly, ground No. 1 of the Revenue is allowed and the addition of Rs. 48,302/- made by the A.O. on account of failure to deposit Employees Contribution of ESI and PF on time is hereby sustained. 6. Ground No. 2 and its sub Grounds are against the deletion of the addition of Rs. 21,00,000/- on account of bad debt written off, Rs. 1,55,000/- on account of discount paid to customer, Rs. 19,18,15,358/- on account of interest paid to various agencies and Rs. 2,16,00,000/- u/s 68 of the Act. The Ld. Department's Representative submitted that the Ld. CIT(A) committed error in remanding the matter to the file of the A.O. for fresh adjudication though the Ld. CIT(A) had no power to do so. 4 ITA No.5824/Del/2-017 DCIT Vs. Skytech Constructions Pvt. Ltd. 7. Per contra, the Ld. Assessee's Representative submitted that after the order of remand, the A.O. has already given effect to the order of the Ld. CIT(A) and made no addition by accepting the explanation given by the Assessee, therefore, submitted that the present Grounds of the Revenue has become in-fructuous. 8. Heard and perused. Though we agree with the submission of the Ld. Departmental Representative that in the year under consideration, the Ld. CIT(A) had no power to remand the matter to the A.O., however, considering after the order of remand on the issue, the Assessing Officer has verified the documents and submission of the Assessee and made no addition on the above issues. With an intention to render substantial justice and finding that no fruitful purpose will be achieved by allowing the Ground No. 2 of the Revenue as the A.O. himself has made no addition after the order of the Ld. CIT(A), we dismiss the Ground No. 2 of the Revenue. 9. In the result, appeal of the Revenue is partly allowed. Order pronounced in the open court on 06th March, 2025 Sd/- Sd/- (BRAJESH KUMAR SINGH) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Date:- 06.03.2025 R.N, Sr.P.S* 5 ITA No.5824/Del/2-017 DCIT Vs. Skytech Constructions Pvt. Ltd. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "