Sneha Fashions Private Limited, Surat V. DCIT, CPC , Bangalore

ITA 54/SRT/2022

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9835 (ITAT-SURAT)
• Duration Of Justice: 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 20-10-2022
• Assessment Year: 2017-2018
• Appeal Filed On: 13-03-2022
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Period of limitation; Reasonable cause; Condonation of delay
• Section: 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. 54 & 55/SRT/2022 Assessment Year: 2017-18 & 2018-19 (Hearing in Virtual Court) Sneha Fashions Private Limited, Plot No. 279/280, Road No. 2, GIDC, Sachin, Surat-394200 (Gujarat). PAN: AAGCS 9570 A Vs D.C.I.T., CPC, Bangalore. Appellant/Assessee Respondent/Revenue Assessee by Ms. Richa Toshniwal, AR Revenue by Shri J.K. Chandani, Sr.DR Date of hearing 21/10/2022 Date of pronouncement 21/10/2022 Order under Section 254(1) of Income tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. These two appeals by the assessee are directed against the orders of learned National Faceless Appeal Centre, Delhi (NFAC)/Commissioner of Income Tax (Appeals), both dated 27/09/2021 for the assessment year (AY) 2018-18 and 20181-9 respectively. 2. In both these appeals, the assessee has raised certain common grounds of appeals except variation of addition on account of disallowance of employees contribution to Provident Fund and ESIC, thus, both the appeals are clubbed, heard together and are decided by consolidate order to avoid the conflicting decision. For appreciation of fact, the appeal in ITA No. 54/Srt/2022 is treated ITA No. 54 & 55/SRT/2022 Sneha Fashions P Ltd. Vs DCIT 2 as ‘lead’ case, wherein the assessee has raised following grounds of appeal: “1. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of Assessing Officer in making addition of Rs. 6,03,790/- on account of disallowance of employees contribution to P.F. and ESIC of Rs. 6,03,790/- u/s 36(1)(va) r.w.s. 2(24)(x) of the Act. 2. It is therefore, prayed that addition made by the Assessing officer and confirmed by CIT(A) may please be deleted. 3. Appellate craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.” 3. On perusal of record, it shows that present appeal is barred by 108 days of the prescribed period of limitation for filing this appeal before the Tribunal. The Ld. Authorized Representative (AR) for the assessee submits that Ld. NFAC/CIT(A) passed the order on 27/09/2021 and present appeal was filed on 15.03.2022. Thus, there is delay of 108 days in filing the appeal before the Tribunal. The Ld. AR for the assessee submits that the Hon'ble Supreme Court in suo motu writ petition(C) No.3 of 2020 has already condoned the period of limitation till 01.03.2022 and further 90 days’ period was granted to file appeal before various courts. Thus, the entire period of delay is covered by the decision of Hon'ble Apex Court. There was no intentional or deliberate delay in filing of appeal. 4. On the other hand, Ld. Senior Departmental Representative (Sr- DR) for the Revenue fairly submits that Bench may be considered the delay in filing appeal before the Tribunal. ITA No. 54 & 55/SRT/2022 Sneha Fashions P Ltd. Vs DCIT 3 5. Considering the submission of both the parties, we find that assessee has reasonable explained the cause of delay for non- filing of appeal due to pandemic of Covid-19. Thus, we find that reasonable cause for condonation of delay in filing the present appeal, therefore, considering the fact and the ld AR for the assessee that there was no intentional or deliberate action in delay in filing, the delay is condoned and appeal is admitted for decision on merits. Now we will advert to discuss the merits to the appeal. 6. Brief facts of the case are that the assessee filed its return of income for A.Y. 2017-18 on 28/10/2017 declaring total income of Rs. 36,77,787/-. The return was processed by the Central Processing Centre, Bangalore (CPC). The CPC while processing the return, made disallowance of deduction of expenditure claimed on account of employee’s contribution to provident fund and ESIC of Rs. 6,03,790/-, vide dated 29/03/2019. 7. 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. ITA No. 54 & 55/SRT/2022 Sneha Fashions P Ltd. Vs DCIT 4 8. 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). 9. 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. 10. 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 ITA No. 54 & 55/SRT/2022 Sneha Fashions P Ltd. Vs DCIT 5 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 of such amounts 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. 11. 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. 12. In the result, appeal of the assessee is dismissed with aforesaid observation. ITA No. 55/Srt/2022 for the A.Y. 2018-19. 13. In this appeal the assessee has raised identical grounds of appeal as taken in the appeal for 2017-18 except variation of disallowance. It is also noted that, there is 108 days in filing this appeal before the Tribunal. Considering the fact that the assessee has raised similar grounds of appeal, the facts of the present appeal is also similar as well as delay in filing the present appeal, thus following the principal of consistency, the ITA No. 54 & 55/SRT/2022 Sneha Fashions P Ltd. Vs DCIT 6 finding given by us in the former paras i.e. in ITA No. 54/Srt/2022 for the Assessment year 2017-18 shall apply mutatis mutandis in this appeal also. In the result, the appeal of the assessee is dismissed. 14. In the result, both the appeals of the assessee are dismissed. Order pronounced on 21/10/2022, in open court at the time of hearing. Sd/- Sd/- (Dr ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 21/10/2022 *Ranjan Copy to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR 6. Guard File By order Sr. Pvt. Secretary, ITAT, Surat