Allarakhi Faruk Shaikh, Bharuch V. Assessing Officer, Ward - 1(5), Bharuch

ITA 120/SRT/2023

AI Insights

The case involves an appeal by Allarakhi Faruk Shaikh against the order of the National Faceless Appeal Centre/Commissioner of Income Tax (Appeals), which confirmed the disallowance of Rs. 2,83,340/- under Section 43B of the Income Tax Act. The disallowance was related to the late payment of employees' provident fund contributions. The assessee argued that this amount had already been disallowed in her income computation, leading to a double disallowance. The Tribunal agreed with the assessee's position and restored the matter to the Assessing Officer for verification and appropriate relief.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 301511 (ITAT-SURAT)
• Duration Of Justice: 1 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 30-03-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 15-02-2023
• Other Referred Cases: Checkmate Services Pvt. Ltd. Vs CIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH (SMC), SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER ITA No. 120/Srt/2023 (Assessment Year 2018-19) (Physical hearing) Allarakhi Faruk Shaikh, Dadri Faliya, Kharach, Kosamba, Bharuch. PAN No. DNMPS 0247 F Vs. I.T.O., Ward 1(5), Bharuch. Appellant/ assessee Respondent/ revenue Assessee represented by Shri Rushi Parekh, CA Department represented by Shri Vinod Kumar, Sr. DR Date of Institution of appeal 16/02/2023 Date of hearing 31/03/2023 Date of pronouncement 31/03/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of learned National Faceless Appeal Centre, Delhi (NFAC)/Commissioner of Income Tax (Appeals), (in short, the ld. CIT(A)) dated 23/12/2022 for the Assessment year (AY) 2018-19 wherein the assessee has raised following grounds of appeal: “1. That the CIT(A) erred in confirming the disallowance of the PF contribution of Rs. 2,83,340/- u/s 43B. 2. That the addition of Rs. 2,83,340/- may kindly be deleted. 3. That the CIT(A) erred in passing ex parte order on dated 23/12/2022 without considering reply submitted on 16/12/2022. 4. The appellant craves leave to add, amend, alter, vary and/or withdraw any or all the above grounds of appeal.” 2. At the outset of hearing, the learned Authorised Representative (ld. AR) of the assessee submits that he has a very limited prayer for verification ITA No. 120/Srt/2023 Allarakhi Faruk Shaikh Vs ITO 2 of fact and to allow relief to the assessee. The ld. AR of the assessee submits that Central Processing Centre (CPC) while processing the return of income made adjustment of Rs. 2,83,340/- on account of delay in payment of employees’ contribution or employees’ provident fund, vide its intimation dated 22/08/2019. The ld. AR of the assessee submits that the assessee in its computation of income has already made disallowance of Rs. 2,83,340/-. Though, it was wrongly typed as disallowance under Section 40B(b) of the Income Tax Act, 1961. The ld. AR further submits that before the ld. CIT(A), the assessee filed her detailed submission and submitted that the employees’ contribution of EPF of April, 2017 was late only for 3-4 days. The assessee has already disallowed such employees provident fund contribution in its computation of income. The ld AR for the assessee submits that copy of computation of income is filed by at page No. 28 of the paper book and copy of submission of assessee dated 15/12/2016 and acknowledgement of e-proceedings response of ITBA Such reply/submission was uploaded on ITBA system on 16/12/2022 alongwith confirmation and certification of Chartered Accountant is also filed on record. The ld. CIT(A) instead of considering such submission, upheld the order of CPC/Assessing Officer by referring the decision of Hon’ble Supreme Court in Checkmate Services Pvt. Ltd. Vs CIT dated 12/10/2022 in Civil Appeal (C) No. 2833/2016. The ld. AR of the ITA No. 120/Srt/2023 Allarakhi Faruk Shaikh Vs ITO 3 assessee submits that once the assessee already disallowed such amount in its computation of income and further disallowance by CPC is double disallowance and the disallowance/adjustment made by the CPC may be deleted. 3. In alternative submission, the ld. AR fairly submitted that this fact may be verified by the Assessing Officer and the Assessing Officer be directed to delete such disallowance. 4. On the other hand the learned Senior Departmental Representative (ld. Sr. DR) for the Revenue that after hearing the submission of assessee and going through the computation of income, copy of which is filed by assessee at page No. 28 of the paper book, submission of assessee dated 15/12/2016 and acknowledgement of e-proceedings response of ITBA submit that the matter may be restored to the Assessing Officer for verification of fact, if the assessee has already disallowed the similar amount in its computation of income and to pass order in accordance with law. 5. I have considered the submissions of both the parties and have gone through the orders of lower authorities carefully. I find from the copy of computation of income that the assessee has already disallowed Rs. 2,83,340/- of contribution of EPF, in its computation of income. The CPC also disallowed the similar amount as it was paid beyond due date. Before the ld. CIT(A), the assessee filed her submission and specifically ITA No. 120/Srt/2023 Allarakhi Faruk Shaikh Vs ITO 4 pleaded that the amount has already been disallowed by the assessee in her computation of income and such disallowance amounts to double disallowance. Considering the facts and circumstances of the case, I find merit in the submission of ld. AR of the assessee that once the assessee has already disallowed contribution of EPF and its disallowance by the CPC processing the return of income amounts to double disallowance, therefore, the issue is restored back to the file of Assessing Officer to verify the facts and allow appropriate relief to the assessee. 6. In the result, this appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 31 st March, 2023. Sd/- (PAWAN SINGH) JUDICIAL MEMBER Surat, Dated: 31/03/2023 *Ranjan Copy to: 1. Assessee – 2. Revenue -- 3. CIT 4. DR 5. Guard File By order // TRUE COPY // Sr. Private Secretary, ITAT, Surat