S S Saib Constructions P.Ltd, Delhi V. ACIT, Circle-2(1) , Faridabad

ITA 1467/DEL/2022

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 6483 (ITAT-DELHI)
• Duration Of Justice: 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2019-2020
• Appeal Filed On: 22-06-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Deemed to accrue or arise in india; Question of law
• Section: 143(1); 250; 191; 139(1)

Judgement Text

1 | Page IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “SMC” BENCH: NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA No.1467/Del/2022 [Assessment Year : 2019-20] S S Saib Constructions P.Ltd., House No. 2043, Multani Mohallah, North West Delhi, Delhi-110034. PAN-AAPCS6297M vs ACIT, Circle-2(1), Faridabad. APPELLANT RESPONDENT Appellant by None Respondent by Shri Om Parkash, Sr.DR Date of Hearing 16.08.2022 Date of Pronouncement 16.08.2022 ORDER PER KUL BHARAT, JM : The present 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”], New Delhi dated 29.11.2021. 2. The assessee has raised following ground of appeal:- 1. “That the Order of the Learned CIT (A) National Faceless Appeal Centre Delhi is bad in law and on facts. 2. That the appellant denies Its liability assessed U/S 250 of the Income Tax Act, 1961 on a total income of Rs. 19,02,489/- and consequently denies to pay tax, interest or penalty based on such assessment. 3. That the Ld. CIT(A) National Faceless Appeal Centre Delhi erred in law and on facts of the facts of the case in confirming the addition of Rs. 879514/- made by CPC Income Tax on account of late deposit of ESIC & EPF. 2 | Page 4. That the appellant prays for the grant of permission to add, alter, delete or modify any or all of the grounds of Appeal at any time on or before the hearing.” 3. At the time of hearing, no one attended the proceedings on behalf of the assessee. Hence, the appeal of the assessee is taken up for hearing in the absence of the assessee. FACTS OF THE CASE 4. Facts giving rise to the present appeal are that the assessee company was engaged in the business of fabrication and civil construction. The assessee filed its return of income electronically u/s 139(1) of the Income Tax Act, 191 [“the Act”] declaring total income of Rs.10,22,975/-. The return was processed u/s 143(1) of the Act by the Central Processing Centre [“CPC”] on 07.07.2020 wherein the addition was made on account of late deposit of employee’s contribution of the PF and ESI amounting to Rs.8,79,514/-. 5. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who confirmed the addition. 6. Now, the assessee is in appeal before this Tribunal. 7. Ld. Sr. DR vehemently submitted that law is clear in this respect and he relied upon the decision of Ld.CIT(A). 8. At the outset, Ld. Counsel for the assessee submitted that issue is squarely covered in favour of the assessee. He relied on various case laws. 9. I have heard the contention of Ld. Sr.DR and perused the material available on record and gone through the orders of the authorities below. The issue in this appeal is related to disallowance of expenditure on account of 3 | Page delay in deposit of employees contribution related to PF & 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 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. 10. In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 16 th August, 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