Prem Kumar Sharma , Haryana V. Mr. Amrit Raj Singh DCIT,CPC Bengaluru , Bengaluru

ITA 1454/DEL/2021

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 7688 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 13-10-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law
• Section: 143(1)

Judgement Text

Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “SMC” BENCH: NEW DELHI (THROUGH VIDEO CONFERENCING ) BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA No.1454/Del/2021 [Assessment Year : 2019-20] Prem Kumar Sharma, C/o-M/s. RRA TAXINDIA, D-28, South Extension, Part-I, New Delhi-110049. PAN-ABXPK5655R vs DCIT, CPC, Bengaluru. APPELLANT RESPONDENT Appellant by Shri Deepesh Garg, Adv. Respondent by Shri Anil Kumar Sharma, Sr.DR Date of Hearing 16.02.2022 Date of Pronouncement 28.02.2022 ORDER PER KUL BHARAT, JM : This appeal filed by the assessee for the assessment year 2019-20 is directed against the order of Ld. CIT(A), National Faceless Appeal Centre (“NFAC”) dated 30.09.2021. 2. The assessee has raised following grounds of appeal:- 1. “That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. DCIT/CPC in making aggregate addition of Rs.2,68,764/- on account of employee's contribution to PF and ESI u/s 36(1)(va) and that too by recording incorrect facts and findings and without observing the principles of natural justice and Page | 2 without appreciating the facts and circumstances of the case. 2. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. DCIT/CPC in making aggregate addition of Rs.2,68,764/- on account of employee's contribution to PF and ESI, is bad in law and against the facts and circumstances of the case and the same is not sustainable on various legal and factual ground. 3. That having regard to the facts and circumstances of the case, Ld. CIT(A) ought to have quashed the order u/s 143(1) passed by Ld. DCIT/CPC as the jurisdiction was not validly assumed as per law. 4. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in making adjustment of Rs.2,68,764/- u/s 143(1) which could not have been made in law. 5. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.” 3. Facts giving rise to the present appeal are that Central Processing Centre (“CPC”), Bengaluru vide intimation u/s 143(1) of the Income Tax Act, 1961 (“the Act”) for Assessment Year 2019-20 made adjustment regarding delay in deposit of employees contribution to PF & ESI. Page | 3 4. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who confirmed the addition. 5. Now, the assessee is in appeal before this Tribunal. 6. Ld. Sr. DR vehemently submitted that law is clear in this respect and he relied upon the decision of Ld.CIT(A). 7. I have heard Ld. Representatives of both the parties and perused the material available on record and gone through the orders of the authority below. The issue in this appeal is related to disallowance of expenditure on account of delay in deposit of employees contribution related to EPF & ESI. The issue is squarely covered by the judgement of Hon’ble Jurisdictional High Court of Delhi in the case of PCIT vs Pro Interactive Service (India) Pvt.Ltd. in ITA No.983/2018 [Del.] order dated 10.09.2018 held as under:- “In view of the judgement of the Division Bench of Delhi High Court in Commissioner of Income Tax versus AIMIL Limited, (2010) 321 ITR 508 (Del.) the issue is covered against the Revenue and, therefore, no substantial question of law arises for consideration in this appeal. The legislative intent was/is to ensure that the amount paid is allowed as an expenditure only when payment is actually made. We do not think that the legislative intent and objective is to treat belated payment of Employee’s Provident Fund (EPD) and Employee’s State Insurance Scheme (ESI) as Page | 4 deemed income of the employer under section 2(23)(x) of the Act.” Therefore, respectfully following the ratio laid down by the Hon’ble Jurisdictional High Court in the above-mentioned binding precedent, I hereby direct the Assessing Officer to delete the disallowance. Thus, grounds raised by the assessee are allowed. 8. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 28 th February, 2022. Sd/- (KUL BHARAT) JUDICIAL MEMBER *Amit Kumar* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI