Nalli Trust, CHENNAI V. DCIT Non Corporate Circle 1, CHENNAI

ITA 754/CHNY/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6565 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 21-03-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SAILENDRA MAMIDIPCIT
• Assessee Lawyers: N DEVANATHAN
• Section: 143(3); 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , ! ' , $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ./ ITA NO.754/CHNY/2019 ( )( / ASSESSMENT YEAR : 2014-15 M/S NALLI TRUST, NALLI HOUSE, NO.9, NAGESWARAN ROAD, CHENNAI - 600 034. PAN : AAATN 0028 K V. THE DEPUTY COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE 1, CHENNAI - 600 034. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SH. N. DEVANATHAN, ADVOCATE -.+, / 0 / RESPONDENT BY : SHRI SAILENDRA MAMIDI, PCIT 1 / 2$ / DATE OF HEARING : 09.04.2019 34) / 2$ / DATE OF PRONOUNCEMENT : 30.04.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX -1, CHENNA I, DATED 13.02.2019, PASSED UNDER SECTION 263 OF THE INCOME- TAX ACT, 1961 (IN SHORT 'THE ACT') PERTAINING TO ASSESSMENT YEAR 2014-15. 2. SH. N. DEVANATHAN, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT THE ASSESSING OFFICER COMPLETED THE ASSESSMENT 2 I.T.A. NO.754/CHNY/19 UNDER SECTION 143(3) OF THE ACT ON 24.11.2016. HOW EVER, ACCORDING TO THE LD. COUNSEL, THE PRINCIPAL COMMISSIONER IN T HE GUISE OF EXERCISING HIS POWER UNDER SECTION 263 OF THE ACT, FOUND THAT THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS AND PRE JUDICIAL TO THE INTERESTS OF REVENUE. ACCORDINGLY, HE DIRECTED THE ASSESSING OFFICER TO EXAMINE THE EMPLOYEES CONTRIBUTION TO ES I AND PF. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE IN FACT PAID THE EMPLOYERS AND EMPLOYEES CONTRIBUTION TO ESI AND P F BEFORE THE DUE DATE FOR FILING THE RETURN UNDER SECTION 139(1) OF THE ACT. THEREFORE, ACCORDING TO THE LD. COUNSEL, THERE IS N O QUESTION OF ANY DISALLOWANCE. THE LD.COUNSEL PLACED HIS RELIANCE O N THE JUDGMENT OF MADRAS HIGH COURT IN CIT V. INDUSTRIAL SECURITY AND INTELLIGENCE INDIA (P.) LTD. IN TC(A). NO.585 & 586 OF 2015 DATE D 24.07.2015. REFERRING TO THE ORDER OF THE PRINCIPAL COMMISSIONE R, THE LD.COUNSEL SUBMITTED THAT THE PRINCIPAL COMMISSIONER EXTRACTED VARIOUS JUDGMENTS OF THE HIGH COURTS AND SUPREME COURT AND FOUND THAT THE EMPLOYEES CONTRIBUTION WAS NOT PAID BEFORE THE STATUTORY TIME GRANTED UNDER THE RESPECTIVE ACT. ACCORDING TO THE LD. COUNSEL, WHEN THE ASSESSEE HAS PAID THE MONEY FROM EMPLOYEES AND EMPLOYERS CONTRIBUTION TO ESI AND PF BEFORE THE DU E DATE FOR FILING 3 I.T.A. NO.754/CHNY/19 THE RETURN OF INCOME UNDER SECTION 139(1) OF THE AC T, IT HAS TO BE ALLOWED. 3. WE HEARD SHRI SAILENDRA MAMIDI, THE LD. DEPARTME NTAL REPRESENTATIVE ALSO. IN VIEW OF THE JUDGMENT OF MA DRAS HIGH COURT IN INDUSTRIAL SECURITY AND INTELLIGENCE INDIA (SUPR A), THE PAYMENTS MADE BEFORE THE DUE DATE FOR FILING THE RETURN OF I NCOME UNDER SECTION 139(1) OF THE ACT HAS TO BE ALLOWED AS DEDU CTION WHILE COMPUTING TAXABLE INCOME. EVEN THOUGH THE ASSESSEE CLAIMS THAT THE PAYMENTS WERE MADE BEFORE THE DUE DATE FOR FILI NG THE RETURN OF INCOME, BOTH THE AUTHORITIES BELOW HAVE NOT VERIFIE D THE SAME. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINI ON THAT THE MATTER NEEDS TO BE VERIFIED BY THE ASSESSING OFFICER WITH REGARD TO THE DATE ON WHICH THE CONTRIBUTION OF EMPLOYEES AND EMPLOYER WERE PAID. THE PRINCIPAL COMMISSIONER FOUND THAT WITHOUT PROPE R ENQUIRY, THE ASSESSING OFFICER ALLOWED THE CLAIM OF THE ASSESSEE WHICH IS PREJUDICIAL TO THE INTERESTS OF REVENUE. 4. WE HAVE CAREFULLY GONE THROUGH THE IMPUGNED ORDE R PASSED BY THE ASSESSING OFFICER. THERE WAS NO REFERENCE A BOUT THE CONTRIBUTION MADE BY THE ASSESSEE TO ESI AND PF. T HEREFORE, THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND WITH REG ARD TO 4 I.T.A. NO.754/CHNY/19 CONTRIBUTION MADE TO ESI AND PF. TO THAT EXTENT, T HERE IS AN ERROR IN THE ORDER OF THE ASSESSING OFFICER. THEREFORE, THE PRINCIPAL COMMISSIONER HAS RIGHTLY EXERCISED HIS POWER UNDER SECTION 263 OF THE ACT. HENCE, THE ASSESSING OFFICER HAS TO RE-EX AMINE THE SAME AS DIRECTED BY THE PRINCIPAL COMMISSIONER IN THE IM PUGNED ORDER. HOWEVER, IT IS MADE CLEAR THAT IN VIEW OF THE JUDGM ENT OF MADRAS HIGH COURT IN INDUSTRIAL SECURITY AND INTELLIGENCE INDIA (P.) LTD. (SUPRA), THE PAYMENTS MADE TOWARDS EMPLOYEES AND E MPLOYERS CONTRIBUTION TO ESI AND PF BEFORE THE DUE DATE OF F ILING THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT HAS TO BE AL LOWED AS DEDUCTION WHILE COMPUTING THE TAXABLE INCOME. 5. WITH THE ABOVE OBSERVATION, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON 30 TH APRIL, 2019 AT CHENNAI. SD/- SD/- ( ! ' ) ( . . . ) (INTURI RAMA RAO) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 6 /DATED, THE 30 TH APRIL, 2019. 5 I.T.A. NO.754/CHNY/19 KRI. / -278 98)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. PRINCIPAL CIT-1, CHENNAI 5. 8: -2 /DR 6. ;( < /GF.