Gajanan Papers & Boards Pvt. Ltd., , Vapi V. CIT (A) NFAC, Delhi

ITA 37/SRT/2022

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 8855 (ITAT-SURAT)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 06-11-2022
• Assessment Year: 2017-2018
• Appeal Filed On: 17-02-2022
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: GOPALKRISHANAN
• Section: 154; 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER ITA No. 37/SRT/2022 Assessment Year: 2017-18 (Hearing in Virtual Court) Gajanan Papers & Boards Private Limited, Fortune Square-II, 7 th Floor, Room No. 704, Daman Road Cahla Vapi -Gujarat. PAN: AACDS 4411R Vs D.C.I.T., CPC, Bangalore. Appellant/Assessee Respondent/Revenue Assessee by Sh Gopalkrishanan, AR Revenue by Sh. Vinod Kumar, Sr. DR Date of hearing 07/11/2022 Date of pronouncement 07/11/2022 Order under Section 254(1) of Income tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee are directed against the orders of learned National Faceless Appeal Centre, Delhi (NFAC)/Commissioner of Income Tax (Appeals), both dated 21/12/2021 for the assessment year (AY) 2017-18. In the grounds of appeal, the assessee has challenged the validity of disallowance of employee’s monthly contribution of ESI & PF, which was deposited beyond the due date prescribed under the relevant Acts. 2. Brief facts of the case are that the assessee filed its return of income for A.Y. 2017-18 on 31.10.2017. The return was processed by the Central Processing Centre, Bangalore (CPC). The CPC while processing the return, made disallowance of Gajanan Papers & Boards Private Limited ITA No. 37/Srt/2022 (AY 2017-18) 2 deduction of expenditure claimed on account of employee’s contribution to provident fund and ESIC of Rs. 3,86,824/- and provident fund of Rs.12,61,997/-, vide dated 15.04.2019. The assessee filed application under section 154 for rectification of order dated 15.04.2019. The application under section 154 was rejected by CPC vide order dated 15.11.2020. 3. Aggrieved by the order of CPC, the assessee filed appeal before the ld. CIT(A). The ld. CIT(A)/ NFAC confirmed the order of Assessing Officer by taking a view that the employees contribution to PF has been paid after due date under the relevant statutory provisions. Further aggrieved, the assessee has filed the present appeal before this Tribunal. 4. We have heard the submissions of learned Authorised Representative (ld. AR) and the learned Senior Departmental Representative (ld. Sr. DR) for the revenue. At the outset of hearing, the ld. Sr. DR for the revenue submits that the grounds of appeal raised by the assessee is covered against the assessee by the latest decision of Hon’ble Supreme Court in the case of Checkmate Services P Ltd. Vs CIT-I in Civil Appeal No. 2833 of 2016 dated 12/10/2022, wherein it is held that essential condition for deduction of such amounts are deposited on or before due date (under statutory provisions under such Acts). Gajanan Papers & Boards Private Limited ITA No. 37/Srt/2022 (AY 2017-18) 3 5. On the other hand, the ld. AR of the assessee after hearing the submission of ld. Sr. DR for the revenue fairly accepted that there was delay in depositing of employee’s contribution of ESIC/P.F. due date prescribed under the statutory provisions of that Act. The ld AR for the assessee submits that the due for deposits of employee’s contribution should be counted from the date of disbursement of wage by the employer/ assessee. 6. On our specific query, if such submissions are accepted, every employer may act in accordance with their convenience. After hearing the quarry of the bench, the ld AR for the assessee agreed that the grounds of appeal are covered by the latest decision of Hon’ble Apex Court Order in Checkmate Services P Ltd. Vs CIT (supra). 7. We have considered the submission of both the parties. We find that there was delay in deposits of employee’s contribution of PF and ESI. Such contribution was deposited beyond the due date prescribed under the relevant Acts. We find that the grounds of appeal raised by assessee is covered against the assessee by the decision of Hon’ble Supreme Court in Checkmate Services P Ltd. Vs CIT-I (supra) wherein the decision of Hon’ble Jurisdictional High Court in Gujarat State Road Transport Corporation Vs CIT was upheld. The Hon’ble Supreme Court held that that essential condition for deduction Gajanan Papers & Boards Private Limited ITA No. 37/Srt/2022 (AY 2017-18) 4 of such amounts are that employee’s contributions are deposited on or before due date under statutory provisions under such Acts. It was further held that if such interpretation is to be adopted, the non-obstante clause under section 43B or anything contained in that provision would not absolve the assessee from its liability to deposit the employee’s contribution on or before the due date as condition for such deduction. 8. In view of the aforesaid factual and legal position, we do not find any merit in the grounds of appeal raised by assessee and we dismiss the same. 9. In the result, appeal of the assessee is dismissed with aforesaid observation. Order pronounced on 07/11/2022, in open court at the time of hearing. Sd/- Sd/- (Dr ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 07/11/2022 Copy to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR 6. Guard File By order // True Copy // Sr. Pvt. Secretary, ITAT, Surat