ACIT 4(2) (1) , MUMBAI V. STOCK HOLDINGS CORPORATION OF INDIA LTD, MUMBAI

MA 220/MUM/2023

AI Insights

The case involves a Miscellaneous Application by the Revenue seeking recall of an ITAT order concerning the disallowance of employee's contributions to PF/ESI. The original ITAT decision did not consider these contributions as debatable under section 143(1) of the Income Tax Act. However, following the Supreme Court's ruling in Checkmate Services Pvt. Ltd. v. CIT, which clarified that such contributions are disallowable if paid after the due date, the Tribunal found the need to recall its earlier order and re-evaluate the matter under the updated legal interpretation.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 299494 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-06-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 15-06-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 28-02-2023
• Other Referred Cases: Checkmate Services Pvt. Ltd. v. CIT, ACIT v. Saurashtra Kutch Stock Exchange Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(1); 72

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI ABY T VARKEY, JM & SHRI GAGAN GOYAL, AM M . A. No . 2 20/ M u m / 2023 ( Ar i s i n g o u t o f I . T . A. No . 1 72 2/ M u m /2021 ) ( As s e s s m e n t Y e a r : 2017-1 8) ACIT-4(2)(1), Room No. 640, Aayakar Bhavan, M.K. Road, Mumbai-400020. बनाम/ V s . M/s Stock Holding Corporation of India Ltd., 301, Centre Point, Dr. Babasaheb Ambedkar Road, Parel, Mumbai-400012. स्थायीलेखासं./जीआइआरसं./P A N N o . A A B C S 1 4 2 9 B (अपीलाथी/Appellant) : (प्रत्यथी / Respondent) अऩीराथी की ओय से / Appellant by : Shri Manish Ajudiya, DR प्रत्मथी की ओय से/Respondent by : Shri Akram Khan, AR स ु नवाई की तायीख / D a t e o f He a r i n g : 16/06/2023 घोषणा की तायीख / D a t e o f P r o n o u n c em e n t : 26/06/2023 आदेश / O R D E R Per Gagan Goyal, Accountant Member: By way of this Miscellaneous Application filed on 16.06.2023, the Revenue is seeking recall/rectification of the order of the Tribunal dated 10.08.2022 passed in ITA No. 287/Mum/2022 for assessment year 2018-19. 2 M . A . N o . 2 2 0/ M u m / 2 0 2 3 M/s Stock Holding Corporation of India Ltd. 2. The Ld. Departmental Representative (DR) referred to the Miscellaneous Application and submitted that in view of the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. v. CIT reported in 143 taxmann.com 178, the employee’s contribution to ESI/PF deposited after the due date of the deposit under the relevant acts, is disallowable in terms of section 36(1)(va) of the Act. He submitted that non-consideration of decision of the Hon’ble Supreme Court has rendered the mistake apparent from record as held by the Hon’ble Supreme Court in the case of ACIT v. Saurashtra Kutch Stock Exchange Ltd. [2008] 173 Taxman 322 (SC), therefore, the impugned order of the Tribunal need to be recalled and decided afresh. 3. As far as issue on merit is concerned, we find that Tribunal held that issue of employee’s contribution to PF/ESI after due date under the relevant enactment was not subject matter of adjustment u/s. 143(1) of the Act as same was issue of debatable nature. But in view of the decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. (supra), any payment for PF/ESI paid after the due date under the relevant enactment, is disallowable in terms of section 36(1)(va) of the Act. Since, the interpretation of the law by the Hon’ble Supreme Court is effective since the date of inception of provisions of the Act; therefore, the issue is no longer the debatable. Further, under the provisions of section 143(1)(a)(ii) of the Act, any incorrect claim which is apparent from the information on the return, is liable for adjustment u/s 143(1) of the Act. Therefore, the Impugned order of the ITAT is hereby recalled. Accordingly, the Miscellaneous Application filed by the Revenue is allowed. As both the parties agreed to argue/hear the matter on the same date itself, therefore, both parties were also heard on the ITA also. 3 M . A . N o . 2 2 0/ M u m / 2 0 2 3 M/s Stock Holding Corporation of India Ltd. 6. In the result, the Miscellaneous Application filed by the Revenue is allowed. Order pronounced in the open court on 26.06.2023. Sd/- Sd/- (Aby T Vakey) (Gagan Goyal) (Judicial Member) Accountant Member Mumbai; ददनाांक Dated: 26.06.2023 Rahul Sharma. आदेश की प्रतिलऱपि अग्रेपिि/Copy of the Order forwarded to : 1. अऩीराथी / The Appellant 2. प्रत्मथी / The Respondent 3. आमकय आम ु क्त(अऩीर) / The CIT(A) 4. आमकय आम ु क्त / CIT - concerned 5. ववबागीम प्रतततनधध, आमकय अऩीरीम अधधकयण, भ ु ांफई / DR, ITAT, Mumbai 6. गार्ड पाईर / Guard File आदेशान ु सार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीऱीय अधिकरण, भ ु ांफई / ITAT, Mumbai