DCIT, Circle-2(1), Bhubaneswar V. Serajuddin & Co., Kolkata

MA 14/CTK/2023

AI Insights

The case involves miscellaneous petitions filed by the revenue against the common order of the ITAT dated 30.9.2022, which pertained to the disallowance of employee's contributions to PF and ESI under section 36(1)(va) read with section 2(24)(x) of the Income Tax Act. The revenue sought to recall the ITAT's order based on a Supreme Court decision that settled the issue. The Tribunal noted that the Supreme Court's decision was applicable and recalled its earlier order, restoring the matter to the Assessing Officer for a fresh examination.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300250 (ITAT-CUTTACK)
• Duration Of Justice: 1 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-03-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 02-03-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 30-01-2023
• Other Referred Cases: Checkmate Services Pvt Ltd vs CIT, Nirakar Security & Consultancy Services Pvt Ltd vs ITO
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Business expenditure
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BEFORE AND ARUN KHODPIA, ACCOUNTANT MEMBER Asst. Commissioner of Income Tax, Circle Bhubaneswar. PAN/GIR No. (Appellant Per Bench These are miscellaneous petitions filed by common order of the ITAT dated 30.9.2022 in ITA No.27/CTK/2017 for the assessment year 2012 year 2011-12 2. Shri S.C.Mohanty, Sr Mishra, ld AR appeared for the assessee. IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE S/SHRI GEORGE MATHAN, JUDICIAL AND ARUN KHODPIA, ACCOUNTANT MEMBER M.A.No.14/CTK/2023 ( in ITA No./CTK/2017 Assessment Year : 2012-13 M.A. No.15/CTK/2023 ((In ITA No.368/CTK/2015) Assessment year: 2011-12 Asst. Commissioner of Income Tax, Circle-2(1), Bhubaneswar. Vs. M/s. Serajuddin & Co., 19/A, British India Street, Kolkata-700069 PAN/GIR No.ABIFS 3758 G (Appellant) .. ( Respondent Assessee by : Shri Sunil Mishra, AR Revenue by : Shri S.C.Mohanty, Sr Date of Hearing : 03/0 Date of Pronouncement : 03 /0 O R D E R These are miscellaneous petitions filed by the revenue against the common order of the ITAT dated 30.9.2022 in ITA No.27/CTK/2017 for the assessment year 2012-13 and in ITA No.368/CTK/2015 for the assessment for recalling the order. Shri S.C.Mohanty, Sr DR appeared for the revenue Mishra, ld AR appeared for the assessee. Page1 | 4 IN THE INCOME TAX APPELLATE TRIBUNAL, JUDICIAL MEMBER AND ARUN KHODPIA, ACCOUNTANT MEMBER M/s. Serajuddin & Co., 19/A, British India Street, 700069 Respondent) Sunil Mishra, AR S.C.Mohanty, Sr DR 03/2023 /03/2023 the revenue against the common order of the ITAT dated 30.9.2022 in ITA No.27/CTK/2017 for the 13 and in ITA No.368/CTK/2015 for the assessment DR appeared for the revenue and Shri Sunil M.A.No.14/CTK/2023 ( in ITA No./CTK/2017 Assessment Year : 2012-13 M.A. No.15/CTK/2023 ((In ITA No.368/CTK/2015) Assessment year: 2011-12 Page2 | 4 3. Ld Sr DR submitted that the issue involved in these appeals is disallowance of employee’s contribution to PF and ESI u/s.36(1)(va) r.w.s 2(24)(x) of the Act. It was his submission that the issue is now settled by the decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt Ltd vs CIT in Civil Appeal No.2833 of 2016 order dated 12.10.2022. He, therefore, prayed that the order of the Tribunal dated 30.9.2022 be recalled for fresh hearing. 4. We have heard the rival submissions. It is noticed that the issue in respect of delay payment of employee’s contribution to PF and ESI paid beyond the due date under the respective Act but before the due date of filing of return is squarely covered by the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt Ltd vs CIT in Civil Appeal No.2833 of 2016 dated 12.10.2022, wherein, the Hon’ble Supreme Court has categorically held that if the employees contribution to PF and ESI has been paid beyond the time prescribed under the relevant PF Act, then same is not allowable under section 43B even after the payment has been made before the due date of filing of return under the Income tax Act. 5. The law laid down by the Hon’ble Supreme Court is the law of the land as it is to be understood from the incorporation of the provisions. Consequently, there is a mistake apparent M.A.No.14/CTK/2023 ( in ITA No./CTK/2017 Assessment Year : 2012-13 M.A. No.15/CTK/2023 ((In ITA No.368/CTK/2015) Assessment year: 2011-12 Page3 | 4 from the order of the Tribunal dated 30.9.2022. This being so, the order of the Tribunal dated 30.9.2022 is recalled and the M.As. filed by the revenue stand allowed. 6. It is further noticed that the issue is now squarely covered by the decision of the Co-ordinate bench of this Tribunal in the case of Nirakar Security & Consultancy Services Pvt Ltd vs ITO in ITA No.98/CTK/2022 for Assessment Year 2016-17, order dated 17.10.2022, wherein, the Co-ordinate Bench of this Tribunal has restored the issue to the file of the Assessing officer with the following directions: “6. Liberty is granted to the ld AR to make all submissions in respect of allowability of disallowed contribution of the employees to PF and ESI under other relevant provisions in the interest of justice. This direction is being given because ld AR has submitted that as the amount is not allowable under section 36(1)(va) of the Act and same is also not covered under section 43B of the Act, the amount of delayed contribution to PF and ESI in respect of employees contribution would be treated as income in the hands of the assessee u/.s.2(24)(x) and on subsequent payment of the same, it would be a business expenditure, which can be claimed u/s.37(1) of the Act. We are not expressing any opinion in regard to his arguments as it has not been examined by the lower authorities. Liberty is also granted to the assessee to raise all arguments as are found necessary by him before the lower authorities.” 7. As the issue in the present appeals is also identical to the issue in the case of Nirakar Security & Consultancy Services Pvt Ltd.,(supra), on identical findings the issue in these appeals is restored to the file of the AO M.A.No.14/CTK/2023 ( in ITA No./CTK/2017 Assessment Year : 2012-13 M.A. No.15/CTK/2023 ((In ITA No.368/CTK/2015) Assessment year: 2011-12 Page4 | 4 for re-adjudication after granting the assessee adequate opportunity of being heard. 8. In the result, M.As filed by the revenue stand allowed and the appeals of the assessee are partly allowed for statistical purposes. Order dictated and pronounced in the open court on 03/03/2023. Sd/- sd/- (Arun Khodpia) (George Mathan) ACCOUNTANT MEMBER JUDICIAL MEMBER Cuttack; Dated 03/03/2023 B.K.Parida, SPS (OS) Copy of the Order forwarded to : By order Sr.Pvt.secretary ITAT, Cuttack 1. The Appellant : ACIT, Circle 2(1), Bhubaneswar 2. The Respondent:/Assessee- M/s. Serajuddin & Co. Kolkata 3. The CIT(A)-, 4. Pr.CIT-, 5. DR, ITAT, Cuttack 6. Guard file. //True Copy//