MR NILESH V. MEHTA , MUMBAI V. AO, CPC, MUMBAI

ITA 1674/MUM/2023

AI Insights

The case involves Shri Nilesh V. Mehta, who appealed against the order of the Commissioner of Income Tax (Appeals) concerning the disallowance of Rs.8,40,462, which was added to his income for the Assessment Year 2020-21. This amount represented the employees' contribution to PF and ESIC, which was deposited after the statutory due date but before the filing of the income tax return. The primary legal issue was whether such delayed deposits should be allowed as deductions under section 36(1)(va) of the Income Tax Act, 1961. The Tribunal, referencing the Supreme Court's decision in Checkmate Services Pvt. Ltd., confirmed that these contributions, if not deposited by the due date, are not deductible.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125134 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-08-2023
• Assessment Year: 2020-2021
• Appeal Filed On: 14-05-2023
• Other Referred Cases: Checkmate Services Pvt. Ltd. vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(1); 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND MS. KAVITHA RAJAGOPAL, JM I TA N o. 167 4/ M u m / 20 23 ( A s s e ss me nt Y ea r: 20 2 0- 21 ) Shri Nilesh V. Mehta B-902, RNA Royal Park, M. G. Road, Kandivali (W), Mumbai-400 067 V s. AO CPC Mumbai P A N / G I R N o. AD A P M 1284 H (Appellant) : (Respondent) Assessee by : None Revenue by : Shri Ashok Kumar Ambastha D a te o f H e a r i n g : 28.08.2023 D ate of P ro n ou n ce me n t : 28.08.2023 O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) (‘ld.CIT(A) for short), National Faceless Appeal Centre (‘NFAC’ for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2020-21. 2. The grounds of appeal raised by the assessee are as under: Ground No.1 Disallowance of Rs.7,65,951/- of employees contribution to PF u/s. 36(1)(va). A typographical error. In law and on facts and circumstances of the case, the learned CIT(A) has erred in not allowing the claim of Rs.7,65,951/- arising on account of the typographical error by inadvertently showing the due date of payment one month earlier instead of statutory due date in Form 3CD of Tax Audit Report containing the calculation of disallowance u/s. 36(1)(va). Ground No. 2 : Non-adjudication of the ground relating to disallowance u/s. 36(1)(va) on account of typographical error 2 ITA No. 1 6 7 4 / M u m / 2 0 2 3 ( A Y 2 0 2 0 - 2 1 ) Shri Nilesh V. Mehta vs. AO CPC In law and on facts and circumstances of the case, the learned CIT(A) has not considered and adjudicated the appellant ground and evidences for allowing the claim of Rs.7,65,951/- on account of typographical error out of total disallowance of Rs.8,40,462/- confirmed by him u/s. 36(1)(va). 3. As there was no representation on behalf of the assessee, we hereby proceed to dispose of this appeal by hearing the learned Departmental Representative ('ld. DR' for short) for the Revenue and on perusal of the materials available on record. 4. The brief facts of the case are that the assessee is a manufacturing firm engaged in the business of manufacturing and supplying of pharmaceuticals and medicinal chemicals. The assessee had filed its return of income dated 29.12.2020 declaring total income at Rs.5,10,19,980/- and the same was processed u/s. 143(1) of the Act. the Assessing Officer ('A.O.' for short)/CPC vide intimation dated 29.11.2021 passed u/s. 143(1) of the Act determined the total income at Rs.5,18,80,330/- by making a disallowance of Rs.8,40,462/- being the employees contribution to provident fund deposited after the due date prescribed under the relevant act but before filing of the return of income. 5. The assessee was in appeal before the ld. CIT(A), challenging the impugned disallowance made by the A.O./CPC and the ld. CIT(A) confirmed the impugned addition by relying on the decision of the Hon'ble Apex Court in the case of Checkmate Services Pvt. Ltd. vs. CIT (in Civil Appeal No. 2833 of 2016 and others vide order dated 12.10.2022) 6. The assessee is in appeal before us challenging the order of the ld. CIT(A). 7. The ld. DR for the Revenue contended that the issue in appeal has been decided by the Hon'ble Supreme Court in the case of Checkmate Services Pvt. Ltd. (supra), 3 ITA No. 1 6 7 4 / M u m / 2 0 2 3 ( A Y 2 0 2 0 - 2 1 ) Shri Nilesh V. Mehta vs. AO CPC wherein the delayed deposit of employees contribution to PF and ESIC is no more an allowable deduction. The ld. DR relied on the said decision and also on the order of the lower authorities. 8. We have heard the ld. DR and perused the materials available on record. The issue related to delayed deposit of employees contribution to PF and ESIC has been dealt with extensively by the decision of the Hon'ble Apex Court in the case of Checkmate Services Pvt. Ltd. (supra). Though the coordinate benches have earlier decided this issue in favour of the assessee by relying on the various decisions of the Hon'ble Jurisdictional High Court, the issue is no longer res integra as the Hon'ble Apex Court has held that delayed deposit of employee’s contribution to PF and ESIC is not an allowable deduction, thereby deciding the issue in favour of the Revenue. 9. From the above observation, we are of the considered opinion that the payment of employee’s contribution to PF and ESIC after the due date prescribed under the relevant Acts but nevertheless paid before the filing of the return of income u/s. 139(1) of the Act, is held to be disallowed u/s. 36(1)(va) of the Act. We do not find any infirmity in the order of the ld. CIT(A) and, therefore, the same is upheld. 10. The assessee has raised the ground of typographical error showing the due date of payment one month earlier instead of statutory due date in Form 3CD of the tax audit report, is not supported by any documentary evidence to substantiate the said error. In the absence of which, we deem it fit to dismiss the ground raised by the assessee. 4 ITA No. 1 6 7 4 / M u m / 2 0 2 3 ( A Y 2 0 2 0 - 2 1 ) Shri Nilesh V. Mehta vs. AO CPC 11. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open court on 28.08.2023. Sd/- Sd/- (Prashant Maharishi) (Kavitha Rajagopal) Accountant Member Judicial Member Mumbai; Dated : Roshani , Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai