M/S. UMIYA ASSOCIATES, MUMBAI V. ASST COMM OF INCOME TAX CIRCLE 27(1) , MUMBAI

ITA 1551/MUM/2022

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The case involves Umiya Associates appealing against the orders of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, concerning the disallowance of employee contributions towards PF and ESI for the Assessment Years 2018-19 and 2019-20. The primary legal issue was the timing of the deposit of these contributions and whether delays in deposit affected their deductibility under section 36(1)(va) of the Income Tax Act, 1961. The Tribunal found that for AY 2019-20, the contributions were deposited before the due dates for some months, but there were delays for June to October 2018. For AY 2018-19, no evidence was provided to show timely deposits, leading to the dismissal of that appeal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136073 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-04-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: F
• Next Hearing Date: 19-01-2023
• Assessment Year: 2019-2020
• Appeal Filed On: 12-06-2022
• Other Referred Cases: Checkmate Services Pvt. Ltd. vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJOJ KUMAR SINHA
• Section: 22

Judgement Text

म ु ंबई ठ “एफ ”,म ु ंबई , ए ं ए . ! फ" हम न, ेख े म' IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “ F ”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER& SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER ं.1551/म ु ं/2022 ( न. . 2019-20) ITA NO.1551/MUM/2022(A.Y.2019-20) ं.1552/म ु ं/2022 ( न. . 2018-19) ITA NO.1552/MUM/2022(A.Y.2018-19) Umiya Associates, 122 Zest Business Space, MG Road, Ghatkopar (East) Mumbai 400 077 PAN: AADFU-3574-E ...... +/Appellant बन म Vs. ACIT, Circle 27(1), Mumbai. ....., - /Respondent + . / Appellant by : Shri M. Subramaniam, Advocate , - . /Respondent by : Shri Manjoj Kumar Sinha ु न ई / - / Date of hearing : 20/01/2023 012 / - / Date of pronouncement : 06/04/2023 ेश/ORDER PER VIKAS AWASTHY, JM: These two appeals by the assessee are directed against the orders of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short ‘the CIT(A)’] for the Assessment Years 2019-20 and 2018-19, respectively. Both the impugned orders are of even date i.e. 23/03/2022. 2 ITA NO.1551/MUM/2022(A.Y.2019-20) ITA NO.1552/MUM/2022(A.Y.2018-19) 2. These appeals are time barred by 22 days. The assessee has filed an application seeking condonation of delay in filing of the appeals. After examining the same we are satisfied that the delay in filing of the appeals is not willful. The delay has been caused due to reasons stated in the application, that appears to be bonafide. The delay in filing of the appeal is condoned and the appeals are admitted for hearing on merits. 3. Shri M. Subramaniam appearing on behalf of the assessee submits that identical issue is involved in both the appeal i.e. disallowance of ESI/PF u/s. 36 (1)(va) of the Income Tax Act, 1961 [ in short 'the Act']. The ld.Counsel for the assessee submits that in Assessment Year 2019-20 there is marginal delay of 1 to 3 days in deposit of the employees contribution for the months of June to October 2018 and there is no delay in depositing employees contribution for the months of May, November, December 2018, January, February, March and April 2019. In assessment proceedings u/s. 143(1), employees contribution has been disallowed even for those months where there is no delay. The ld.Counsel for the assessee furnished a chart/details – Viz. date, amount, etc. of the contributions received from employees and deposits thereof. The ld.Counsel for the assessee further furnished online deposit challans for the F.Y. relevant to the Assessment Year 2019-20. The ld.Counsel for the assessee prayed for restoring this issue to the file of Assessing Officer to re-examine the details furnished. 4. Per contra, Shri Manjoj Kumar Sinha representing the Department vehemently defended the impugned order. The ld. Departmental Representative submits that in the light of recent decision of Hon'ble Supreme Court of India in the case of Checkmate Services Pvt. Ltd. vs. CIT, 143 3 ITA NO.1551/MUM/2022(A.Y.2019-20) ITA NO.1552/MUM/2022(A.Y.2018-19) taxmann.com 178 the delay in deposit of employees contribution towards PF and ESI is liable to be disclosed u/s. 36(1)(va) of the Act. 5. We have heard the submissions made by rival sides and have examined orders of authorities below. The solitary issue raised in both the appeals is with respect to disallowance of Rs.14,26,241/- u/s. 36(1)(va) in assessment year 2019-20 and Rs.10,25,091/- in assessment year 2018-19. 6. For the period relevant to assessment year 2019-20, the assessee has furnished a chart giving details of the amount received from employees, due date for payment and actual date of payment. The short contention of the assessee is that the assessee has deposited contributions received from the employees before the due date for the months of May, November, December 2018 and January to April 2019. The delay in deposit of employees contribution is only for the months of June to October 2018. To substantiate its plea the assessee has also filed copies of the challans. Purportedly, for the Assessment Year 2019-20, entire employees contribution have been disallowed u/s. 36(1)(va) of the Act. We deem it appropriate to restore this issue to the file of Assessing Officer for the limited purpose of ascertaining the date of amounts received from employees and the amount deposited by the assessee on or before the due date. The Assessing Officer after ascertaining the facts shall decide this issue in the light of decision rendered by Hon'ble Apex Court in the case of Checkmmate Services Pvt. Ltd. vs. CIT (supra). Consequently, the appeal of the assessee in ITA No.1551/Mum/2022 for Assessment Year 2019-20 is allowed for statistical purpose. 4 ITA NO.1551/MUM/2022(A.Y.2019-20) ITA NO.1552/MUM/2022(A.Y.2018-19) 7. The assessee has not filed any chart/documentary evidence for Assessment Year 2018-19 to show that the amounts were deposited before due date. We find no infirmity in the order of CIT(A) in disallowing deduction of employees contribution towards ESI/PF u/s. 36(1)(va) of the Act. Thus, in the light of decision in the case of Checkmmate Services Pvt. Ltd. (supra), appeal of the assessee in ITA NO.1552/Mum/2022 is dismissed. 8. To sum up, assessee’s appeal for Assessment Year 2019-20 is allowed for statistical purpose and for Assessment Year 2018-19 is dismissed. Order pronounced in the open court on Thursday the 06 th day of April, 2023. Sd/- Sd/- (SHRI S.RIFAUR RAHMAN) (VIKAS AWASTHY) ेख /ACCOUNTANT MEMBER /JUDICIAL MEMBER म ु ंबई/ Mumbai, 4 न ं /Dated 06/04/2023 Vm, Sr. PS(O/S) त ल प अ े षतCopy of the Order forwarded to : 1. +/The Appellant , 2. , - / The Respondent. 3. ु 5-CIT 4. 6 7 , - न , . . ., म ु बंई/DR, ITAT, Mumbai 5. 7 89 फ : /Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar)/Sr. Private Secretary ITAT, Mumbai