ITO, WARD-34(1), NEW DELHI V. APT SERVICES GROUP, DELHI

MA 327/DEL/2022

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The case revolves around a Miscellaneous Application filed by the Income Tax Department seeking rectification of an earlier Tribunal order that had allowed the appeal of APT Services Group, deleting an addition made by the Assessing Officer regarding delayed contributions to EPF & ESI for the assessment year 2018-19. The Department argued that the Tribunal's decision was contrary to a subsequent Supreme Court ruling in Checkmate Services (P.) Ltd. vs. CIT, which clarified the law regarding the deductibility of employees' contributions to EPF & ESI. However, the Tribunal noted that its original decision was based on the law as it stood at the time of the decision, which was prior to the Supreme Court's ruling.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633498 (ITAT-DELHI)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 13-06-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2018-2019
• Other Referred Cases: CIT vs. AIMIL Ltd., PCIT vs. Pro Interactive Service (India) P. Ltd., Checkmate Services (P.) Ltd. vs. CIT, Infantry Security and Facilities vs. ITO
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: TANPREET KOHLI

Judgement Text

" आयकर अपीलीय अिधकरण िदʟी पीठ “एस एम सी”, िदʟी ŵी िवकास अव̾थी, Ɋाियक सद˟ IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “SMC”, DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER MA No. 327/Del/2022 (Arising out of ITA No. 957/Del/2021, A.Y 2018-19) Income Tax Officer, Ward-34(1), New Delhi ...... आवेदक/Applicant बनाम Vs. APT Services Group, 465, C/1, Azadpur, Aaiyed Wali Gali, Delhi 110033 PAN: AAOFA-8445-R ..... ĤǓतवादȣ/Respondent आवेदक ɮवारा/ Applicant by : Shri Sahil Kumar Bansal, Sr. DR Ůितवादी Ȫारा/Respondent by : Shri Tanpreet Kohli, Advocate सुनवाई कȧ Ǔतͬथ/ Date of hearing : 21/03/2025 घोषणा कȧ Ǔतͬथ/ Date of pronouncement : 13/06/2025 आदेश/ORDER PER VIKAS AWASTHY, JM: This Miscellaneous Application has been filed by the Revenue seeking rectification in order of the Tribunal dated 20.05.2022 vide which ITA No. 957/Del/2021 for AY 2018-19 by the assessee was allowed. 2. Shri Sahil Kumar Bansal, representing the department submits that the Tribunal placing reliance on the decision of Hon’ble Delhi High Court in the case of CIT vs. AIMIL Ltd., 321 ITR 508 & PCIT vs. Pro Interactive Service (India) P. Ltd. in ITA No. 983/2018 allowed appeal of the assessee and deleted the addition of 2 MA No.327/Del/2022 (AY 2018-19) Rs.21,18,225/- made by Assessing Officer (AO) on account of delayed contribution towards EPF & ESI. He submitted that now the issue has been settled by the Hon’ble Supreme Court of India in the case of Checkmate Services (P.) Ltd. vs. CIT, 143 taxmann.com 178 (SC). In light of the aforesaid decision by Hon’ble Supreme Court of India, there is a mistake apparent on record in the order of Tribunal in deleting delayed deposit of employee’s contribution towards EPF & ESI. 3. Per contra, Shri Tanpreet Kohli appearing on behalf of the assessee vehemently defended order of the Tribunal and submitted that the Tribunal order was passed prior to the decision of Hon’ble Apex Court in the case of Checkmate Services (P.) Ltd. vs. CIT (supra). On the date of passing of the order, the Tribunal followed the decision rendered by Hon’ble Jurisdictional High Court and deleted the addition. The decision in the case of Checkmate Services (P.) Ltd. vs. CIT (supra) was rendered by the Hon’ble Apex Court much later in time. Therefore, there is no mistake in the order of Tribunal. 4. Both sides heard. The Department has filed Miscellaneous Application u/s. 254(2) of the Act seeking rectification in the order of Tribunal dated 20.05.2022 on the ground that the decision rendered by the Tribunal is contrary to the decision of Hon’ble Supreme Court of India in the case of Checkmate Services (P.) Ltd. vs. CIT (supra). It is an undisputed fact that the order of Tribunal is much prior to the decision of Hon’ble Supreme Court of India in the case of Checkmate Services (P.) Ltd. vs. CIT (supra). The Hon’ble Bombay High Court in Writ Petition No. 17175 of 2024 in the case of Infantry Security and Facilities vs. ITO decided on 03.12.2024 while dealing with identical issue held as under:- 3 MA No.327/Del/2022 (AY 2018-19) “14. In our clear opinion, the question would be required to be answered against the Revenue and in favour of the assessee. The reasons for which we discuss hereunder. In such context, at the outset, we may observe that the petitioner had succeeded before the Tribunal on the basis of the position in law as it prevailed on the day the decision was rendered on the petitioner's appeal on 26 July 2022. Subsequent to the said orders passed by the Tribunal, on 12 October 2022, the Supreme Court rendered its decision in \"Checkmate Services Private Limited\" (Supra), whereby the Supreme Court held that the deduction of the employees' share can be allowed under Section 36(1)(va) of the IT Act, only if such share was deposited before the time limit under the respective statutes and not before the due date under Section 139(1) of the IT Act. In the fact situation, certainly it cannot be said that the Tribunal has overlooked the existing position in law, as laid down by the Supreme Court or the High Court, so as to bring about a situation that the law declared by the Supreme Court was not followed by the Tribunal and/or the decision of the Tribunal is contrary to the law as laid down by the Supreme Court. Such decision of the Supreme Court which never existed when the Tribunal passed the original order could never have been applied by the Tribunal, and hence it cannot be said that there was any mistake on the face of the record, so as to confer jurisdiction on the Tribunal to exercise its jurisdiction under Section 254(2) of the IT Act.” [Emphasized by us] 5. Thus, in light of the facts of the case, the provisions of section 254(2) of the Act and the aforesaid decision, we find no merit in Miscellaneous Application filed by the Department. Hence, the same is dismissed. Order pronounced in the open court on Friday the 13th day June, 2025. Sd/- (VIKAS AWASTHY) ÛयाǓयक सदèय/JUDICIAL MEMBER िदʟी/Delhi, Ǒदनांक/Dated 13.06.2025 NV/- 4 MA No.327/Del/2022 (AY 2018-19) ĤǓतͧलͪप अĒेͪषत/Copy of the Order forwarded to : 1. अपीलाथȸ/The Appellant , 2. ĤǓतवादȣ/ The Respondent. 3. The PCIT/CIT(A) 4. ͪवभागीय ĤǓतǓनͬध, आय.अपी.अͬध., िदʟी /DR, ITAT, िदʟी 5. गाड[ फाइल/Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, DELHI "