M.K.S.ENGINEERING COMPANY PRIVATE LIMITED,JABALPUR V. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-2(1), JABALPUR

ITA 154/JAB/2023

AI Insights

The case involves M.K.S Engineering Company Pvt Ltd, the appellant, contesting an addition of Rs. 98,520 to their total income for the assessment year 2012-13, which was made under section 36(1)(va) of the Income-tax Act, 1961 due to alleged delay in payment of employees' contribution to the Provident Fund. The rectification order was initially passed by the Assessing Officer on 13.03.2019 and was upheld by the Commissioner of Income Tax (Appeals) on 18.10.2023, referencing a Supreme Court judgment in Checkmate Services (P.) Ltd. & Ors. vs. CIT-1. The appellant argued that the payment was made within the prescribed time and that the issue was debatable, thus not suitable for rectification under section 154 of the Act. The ITAT found procedural deficiencies in the rectification process and remanded the matter back to the Assessing Officer for a fresh decision.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837623 (ITAT-JABALPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 15-12-2023
• Other Referred Cases: Checkmate Services (P.) Ltd. & Ors. vs. CIT-1, Climax Overseas Pvt. Ltd vs. DCIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAHUL PADHA; JC
• Assessee Lawyers: DHIRAJ GHAI
• Keywords: Rectification of order
• Section: 154

Judgement Text

"I.T.A. No.154/JAB/2023 Assessment Year: 2012-13 1 IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH “DB”, JABALPUR BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER I.T.A. No.154/JAB/2023 Assessment year: 2012-13 M.K.S Engineering Company Pvt Ltd 1 Namak Kothi North Civil Lines, Jabalpur-482001. PAN:AADCM1192R Vs. DCIT Circle-2(1) Aayakar Bhawan, Annexe Building Napier Town, Jabalpur-482001. (Appellant) (Respondent) O R D E R PER ANADEE NATH MISSHRA: A.M. (A) This appeal vide I.T.A. No.154/JAB/2023 has been filed by the assessee for assessment year 2012-13 against impugned appellate order dated 18.10.2023 (DIN & Order No.ITBA/NFAC/S/250/2023- 24/1057182983(1) of Ld. Commissioner of Income Tax (Appeals) [“CIT(A)” for short]. (B) In this case, the dispute pertains to rectification order dated 13.03.2019 passed by the Assessing Officer (“AO”) whereby an addition of Rs. 98,520/- to the total income was made u/s 36(1)(va) of the Income-tax Act, 1961 (“Act”, for short). The aforesaid addition pertains to the delay in payment of employees’ contribution to the Provident Fund (ECPF). The assessee’s appeal against the said rectification order passed under section 154 of the Act was dismissed by the Ld. CIT(A), holding that the issue had attained finality in view of the judgment of the Hon’ble Supreme Court in Checkmate Services (P.) Ltd. & Ors. vs. CIT-1, Civil Appeal No. 2833 of 2016, dated 12.10.2022. In the present appeal, the order of the Ld. CIT(A) is challenged on two grounds. Firstly, the assessee contends that the entire amount of Rs. 98,520/- was paid within the prescribed time and, therefore, Appellant by Shri Dhiraj Ghai, CA Respondent by Shri Rahul Padha, JC-2 Printed from counselvise.com I.T.A. No.154/JAB/2023 Assessment Year: 2012-13 2 no addition was warranted. Secondly, the assessee contends that the issue was debatable in nature and, therefore, recourse to section 154 of the Act could not have been taken by the AO for making an addition on a debatable issue. In the course of appellate proceedings in ITAT, the assessee filed a paper book containing the following particulars: - (B.1) At the time of hearing, the Ld. Authorized Representative (“AR, for short) for assessee supported the grounds of appeal. He placed reliance on the paper book filed in the course of paper book [referred in foregoing paragraph no. (B) of this order]. He also placed reliance on the order of the Delhi Bench of the ITAT in the case of Climax Overseas Pvt. Ltd. vs. DCIT in ITA No. 2267/Del/2025. The Ld. Departmental Representative (“DR”, for short) for Revenue supported the orders of the Ld. CIT(A) and the order of the AO. (C) We have heard both sides. We have perused the materials on record. On perusal of the aforesaid order dated 13.03.2019 passed u/s 154 of the Act, it is found that paragraph no. 3 of the order mentions issuance of only one notice given to the assessee, (i.e., notice dated 01.01.2019). However, there is no mention of any further opportunity having been provided to the assessee. Moreover, the order is silent regarding the time allowed to the assessee for compliance with the said notice. In these circumstances, we are of the considered view that the aforesaid order passed u/s 154 of the Printed from counselvise.com I.T.A. No.154/JAB/2023 Assessment Year: 2012-13 3 Act was made without providing reasonable opportunity to the assessee. Therefore, the issues in dispute in the present appeal are restored to the file of the Assessing Officer with a direction to pass de novo order in accordance with law, after providing reasonable opportunity to the assessee and after giving due consideration to the judgment of the Hon’ble Supreme Court in the case of Checkmate Services (P) Ltd. & Ors. vs. CIT-1 (supra). All pleadings will be available to the assessee in the proceedings before the Assessing Officer while giving effect to this order. All grounds of appeal are treated as disposed of in accordance with the aforesaid direction. (D) In the result, the appeal of the assessee stands partly allowed for statistical purposes. (Order pronounced in the open court on 19/02/2026 Sd/- Sd/- [KUL BHARAT] [ANADEE NATH MISSHRA] VICE PRESIDENT ACCOUNTANT MEMBER Dated: 19/02/2026 Vijay Pal Singh (Sr. PS) Copy of the order forwarded to : 1. The Appellant 2. The Respondent. 3. Concerned CIT 4. D.R., I.T.A.T., Jabalpur Printed from counselvise.com I.T.A. No.154/JAB/2023 Assessment Year: 2012-13 4 Sl. No Particulars Date 1 Date of dictation 11.02.2026 2 Date on which the draft is placed before the Dictating Member 3 Draft placed before the other Member 4 Approved draft comes to the Sr. PS/PS 5 Kept for pronouncement on 6 Final order received after pronouncement 7 File sent to the Bench Clerk 8 Date on which files goes to the Head Clerk 9 Date on which file goes to the Assistant Registrar 10 Date of dispatch of order Printed from counselvise.com "