Hanmantsing Naryansing Bayas, Pune V. Income-Tax Officer, Ward 8(1), Pune

ITA 933/PUN/2022

AI Insights

This case involves an appeal by Hanmantsing Narayansing Bayas against the order of the National Faceless Appeal Centre (NFAC), Delhi, which confirmed the disallowance of Rs.16,06,700 by the Central Processing Centre (CPC), Bangalore. The disallowance pertained to the employee's contributions to PF/ESI which were not deposited by the due dates as required under the respective statutes. The main legal issue was whether the CIT(A) was justified in confirming the addition made by the CPC under section 36(1)(va) of the Income Tax Act. The Tribunal, after hearing the Departmental Representative and reviewing the material on record, upheld the decision of the CIT(A), referencing the Supreme Court's decision in Checkmate Services P. Ltd. which clarified that such contributions must be deposited within the statutory due dates to be eligible for deduction.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 132941 (ITAT-PUNE)
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-02-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 06-02-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 20-12-2022
• Other Referred Cases: Checkmate Services P. Ltd. in Civil Appeal No. 2833 of 2016
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER आयकर अपील सं. / ITA No.933/PUN/2022 धििाारण वर्ा / Assessment Year : 2018-19 Hanmantsing Narayansing Bayas, Plot No. 275, Manohar Nagar, Talegaon Maval, Pune-410501 PAN : AKPPB5995E ......अपीलार्थी / Appellant बिाम / V/s. The Income Tax Officer, Ward - 8(1), Pune ......प्रत्यर्थी / Respondent Assessee by : N O N E Revenue by : Shri Ramnath P. Murkunde सुनवाई की तारीख / Date of Hearing : 07-02-2023 घोषणा की तारीख / Date of Pronouncement : 09-02-2023 आदेश / ORDER PER S.S. VISWANETHRA RAVI, JM : This appeal by the assessee against the order dated 21-11-2022 passed by the National Faceless Appeal Centre (“NFAC”), Delhi for assessment year 2018-19. 2. We find no representation on behalf of the assessee nor any application filed seeking adjournment. Thus, the assessee called absent and set ex-parte. Therefore, we proceed to dispose of the appeal by hearing the ld. DR and perusing the material available on record. 2 ITA No.933/PUN/2022, A.Y. 2018-19 3. The only issue is to be decided is as to whether the CIT(A), NFAC, Delhi justified in confirming the addition made by the CPC u/s. 36(1)(va) of the Act. 4. Heard ld. DR and perused the material available on record. We note that the assessee is an individual filed return of income on 14-02-2019. The CPC, Bangalore disallowed an amount of Rs.16,06,700/- for not depositing the employee’s contribution of PF/ESI before prescribed due dates under the respective Act. Having aggrieved, the assessee preferred an appeal before the CIT(A). The assessee contended that the assessee is entitled to claim deduction if the employee’s contribution is paid before due dates of filing return of income. The CIT(A) on an examination of Tax Audit Report held that the assessee did not deposit an amount of Rs.16,06,700/- which is employee’s contribution towards PF/ESI before the due date under the respective Act and confirmed the disallowance made by the CPC, Bangalore for delay in depositing the said employee’s contribution before due dates concerning the relevant Act. The ld. DR placed on record the decision of Hon’ble Supreme Court in batch of the appeals, lead case being Checkmate Services P. Ltd. in Civil Appeal No. 2833 of 2016 and submitted that the assessee is not entitled to claim deduction if the employee’s contribution is not paid within due dates of respective statutes. On careful reading of the said decision of Hon’ble Supreme Court held that Section 2(24)(x) deems amount received from the employees as income and the amounts retained by the employer from out of the employee’s income by way of deduction etc. were treated as income in the hands of the employer (assessee). Further, it held unless the conditions spelt by Explanation to section 36(1)(va) are satisfied i.e., depositing such amount received or deducted from the employee on or before the due date of respective statutes, the assessee is not entitled to claim benefit of deduction from the 3 ITA No.933/PUN/2022, A.Y. 2018-19 total income. Therefore, in our opinion, essential condition for claiming such deduction if such amounts are deposited on or before due date of respective statutes. It is evident from the impugned order that the assessee deposited the employee’s contribution to PF/ESI after the prescribed due date of relevant Act which is not disputed by the ld. AR. Therefore, following the decision of Hon’ble Supreme Court in the case of Checkmate Services P. Ltd. (supra) we find no infirmity in the order of CIT(A), NFAC, Delhi in holding the assessee is not entitled to claim deduction for its failure to deposit employee’s contribution before due date prescribed under the relevant statutes. Thus, the ground raised by the assessee is fails and it is dismissed. 5. In the result, the appeal of assessee is dismissed. Order pronounced in the open court on 09 th February, 2023. Sd/- Sd/- (R.S. Syal) (S.S. Viswanethra Ravi) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिनाांक / Dated : 09 th February, 2023. रदव आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The CIT(A) concerned. 4. The Pr. CIT concerned. 5. दवभागीय प्रदतदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गार्ड फ़ाइल / Guard File. //सत्यादपत प्रदत// True Copy// आिेशानुसार / BY ORDER, वररष्ठ दनजी सदचव / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune