SANJAY KUMAR AGRAWAL, CUTTACK V. BBN-C-(4)(8), INCOME TAX OFFICE, CUTTACK

ITA 212/CTK/2024

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 5787 (ITAT-CUTTACK)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 15-07-2024
• Assessment Year: 2019-2020
• Appeal Filed On: 03-05-2024
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 145; 43B

Judgement Text

आयकर अऩीऱीय अधधकरण, कटक न्यायऩीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER आयकर अऩीऱ सं/ITA No.212/C TK/2024 (ननधाारण वषा / Asses s m ent Year : 2019-2020) Sanjay Kumar Agrawal, C/O: Jagannath & Jagannath, Jobra Road, College Square, Odisha-753003 Vs DCIT, Circle-1(1), Cuttack PAN No. :AASPA 3785 E (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) ननधााररती की ओर से /Assessee by : Shri Mohit Sheth, Advocate राजस्व की ओर से /Revenue by : Shri S.C.Mohanty, Sr. DR स ु नवाई की तारीख / Date of Hearing : 16/07/2024 घोषणा की तारीख/Date of Pronouncement : 16/07/2024 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, dated 29.04.2024, in DIN & Order No.ITBA/NFAC/S/250/2024- 25/1064424309(1) for the assessment year 2019-2020. 2. The facts of the case are that the assessee has filed the return of income on 30.09.2019, declaring total income at Rs.100,31,070/-, which was processed u/s.143(1) of the Act vide order dated 14.05.2020, wherein an addition of Rs.66,49,490/- was made u/s.43B of the Act. Against this order the assessee filed an application u/s.154 of the Act before the AO stating that all the payments which were disallowed u/s.43B of the Act were made within the time prescribed under the relevant Acts and copy of challans were also submitted. The CPC vide order passed u/s.154 of the Act dated 03.08.2023 has not accepted the request of the assessee and ITA No.212/CTK/2024 2 reaffirm the order passed u/s.143(1) of the Act. Therefore, aggrieved by the action of the CPC, the assessee has preferred the appeal before the ld. CIT(A) NFAC. The CIT(A), NFAC vide order dated 29.04.2024 has dismissed the appeal of the assessee by not accepting the contention of the assessee, thus, the present appeal is filed by the assessee before us. 3. During the course of hearing, ld. AR submitted that the assessee has shown GST payable at Rs.65,76,707/-, ESI payable of Rs.22,159/- and EPF payable of Rs.50,624/- in its Balance Sheet for the year ended 31.03.2019, wherein all these items were appeared at Schedule V of the Balance Sheet under the title Sundry Creditors & others. The auditor in audit report in column No.26(i) of Form 3CD has certified that these amounts were paid before the due date and date of payments were also mentioned which are as under :- ITA No.212/CTK/2024 3 4. In support of the payments, ld. AR drew our attention to the copies of challans available in paper book at pages 18 to 20. Ld.AR, thus, submitted that when the payments were made within the due dates prescribed under the relevant Act, and also no violation was made by the assessee, the CPC has wrongly made the disallowance. He further submitted that the ld. CIT(A) while dismissing the appeal of the assessee has wrongly invoked the provisions of Section 36(1)(va) of the Act on the entire amounts payable including GST payable which is not covered under the said Section. Further the employer contribution to PF & ESI were also not covered u/s.36(1)(va) of the Act, therefore, the ld. CIT(A) has not appreciated the facts of the case properly and wrongly applied the judgment of the Hon’ble Supreme Court in the case of Checkmate Services (P.) Ltd. Vs. CIT, reported in [2022] 143 taxmann.com 178 (SC). He, therefore, prayed for deletion of addition so sustained by the lower authorities. 5. On the other hand, ld. Sr. DR supported the order of the lower authorities and submitted that the assessee in the audit report in Form 3CD in the Item at Sl.No.26(ii) has stated that the GST is not passed through profit and loss account and, therefore, provisions of Section 145A of the Act are applicable in the present case and, thus, the disallowance made by the CPC is correct. He further submitted that the assessee has not filed the details in correct column of the audit report, therefore, disallowances were made by the CPC and confirmed by the ld.CIT(A). He, ITA No.212/CTK/2024 4 however, supported the order of the ld. CIT(A) and requested for confirming the disallowance so made. 6. We have considered the rival submissions and perused the material available on record. Surprisingly, in this case, the CPC as well as ld. CIT(A) have failed to appreciate the fact that the assessee has shown the amounts payable in its balance sheet as on the last date of the previous year which were paid by him within the prescribed time limit. To be specific, the ESI payable at Rs.22,159/-, which includes employee’s contribution of Rs.3421/- was paid on 2 nd April, 2019, which is evident from the copy of challan available at paper book at page 19. EPF payable of Rs.50,624/- including Rs.26543/- towards employees contribution was paid on 3 rd April, 2018 as evident from copy of challan at page 20 of the paper book. Likewise, GST payable at Rs.6576706.65 was paid by the assessee on 20 th April, 2019 and a copy of challan was filed at page 18 of the paper book. Since all the payments have been made within the due date as prescribed under the relevant Acts, there is no question of making any disallowance by invoking the provisions of Section 43B of the Act. The CPC/AO failed to appreciate this fact even in the rectification order passed u/s.154 of the Act where the assessee has filed the copies of the challans in support of his claim. Therefore, the disallowance made by the CPC and upheld by the ld.CIT(A) is hereby deleted. 7. With regard to the contention of the ld. Sr. DR for the application of Section 145A of the Act, it is seen that the CPC has made the disallowance u/s.43B of the Act and the ld. CIT(A) himself understood it ITA No.212/CTK/2024 5 as the disallowance u/s.36(1)(va) of the Act and at no stage, provisions of Section 145 of the Act were invoked by the lower authorities. It is a case of processing u/s.143(1) of the Act which does not allow any such disallowance by invoking the provisions of Section 145A of the Act. This being so, this contention of the ld. Sr. DR is devoid of any merits and cannot be acceded to. In view of the discussion made hereinabove, the disallowance made at Rs.66,49,490/- is hereby deleted. 8. In the result, appeal of the assessee is allowed. Order dictated and pronounced in the open court on 16/07/2024. Sd/- (GEORGE MATHAN) Sd/- (MANISH AGARWAL) न्यानयक सदस्य / JUDICIAL MEMBER ऱेखा सदस्य/ ACCOUNTANT MEMBER कटक Cuttack; ददनाांक Dated 16/07/2024 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- Sanjay Kumar Agrawal, C/O: Jagannath & Jagannath, Jobra Road, College Square, Odisha-753003 2. प्रत्यथी / The Respondent- DCIT, Circle-1(1), Cuttack 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. ववभागीय प्रतततनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ड पाईऱ / Guard file. सत्यावऩत प्रतत //True Copy//