DY. COMMISSIONER OF INCOME TAX, CIRCLE-5(2)(1) , MUMBAI V. M/S. JSW CEMENT LTD, MUMBAI

MA 252/MUM/2023

AI Insights

The case involves M/s JSW Cement Ltd. appealing against the disallowance of an employee's contribution to PF amounting to Rs.30,49,649/- by the Assessing Officer under section 36(1)(va) of the Income Tax Act, 1961. The Tribunal initially allowed the claim based on a previous decision. However, following a Supreme Court ruling in Checkmate Services Pvt. Ltd., which clarified that such contributions are not deductible if made beyond the prescribed due date, the Revenue filed a Miscellaneous Application to recall the Tribunal's order. The Tribunal, acknowledging the Supreme Court's retrospective application of the law, allowed the Revenue's application and dismissed the appeal on this ground.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123498 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-09-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 29-06-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 22-03-2023
• Other Referred Cases: Sahakari Ginning and Pressing Factory v. ACIT, Daryapur Shetkari Sahakari Ginning and Pressing Factory v. ACIT, Harendra Nath Biswas v. DCIT, Checkmate Services Pvt. Ltd. v. DCIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: GAURAV
• Keywords: Period of limitation; Time period of passing order
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “F” MUMBAI BEFORE SHRI VIKAS AWASTHY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) M.A. No. 252/MUM/2023 (Arising out of ITA No. 241/MUM/2022) Assessment Year: 2018-19 Dy. CIT Circle-5(2)(1), R. No. 571, 5 th floor, Aayakar Bhavan, M.K. Road, Mumbai-400020. Vs. M/s JSW Cement Ltd., JSW Centre Bandra Kurla Complex, Bandra (East), Mumbai-400051. PAN No. AABCJ 6731 B Appellant Respondent ITA No. 241/MUM/2022 Assessment Year: 2018-19 M/s JSW Cement Ltd., JSW Centre Bandra Kurla Complex, Bandra (East), Mumbai-400051. Vs. Dy. CIT Circle-5(2)(1), R. No. 571, 5 th floor, Aayakar Bhavan, M.K. Road, Mumbai-400020. PAN No. AABCJ 6731 B Appellant Respondent Assessee by : Mr. Gaurav Revenue by : Mr. Manoj Sinha, DR Date of Hearing : 30/06/2023 Date of pronouncement : 08/09/2023 ORDER PER OM PRAKASH KANT, AM The Miscellaneous Application u/s 254(2) of the Income-tax Act, 1961 (in short ‘the Act’) by the Revenue has been preferred against order dated 12.08.2022 Tribunal (In short the ‘Tribunal’) assessment year 2018 Sahakari Ginning and Pressing Factory v. ACIT (2021) 320 CTR 456 (Bom.) Hon’ble Bombay High court , has held that period of limitation for section 254(2) of the Act would commence from date when affected party got knowledge of decision in question and it would not commence from date when order was passed. impugned order of Tribunal of Income-tax-1 (in short ‘the PCIT’) miscellaneous application has been filed on 23.03.2023 being within the period of six month order by the Principal Miscellaneous Application Hon’ble Bombay High Court in the case of Sahakari Ginning an admitted for adjudication. 2. In the miscellaneous application, the Revenue has prayed for recalling the ground No. 1 (one) of the appeal, therefore, for ready reference, said ground is reproduced as under: “1. On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in restricting the action of Learned Assessing Officer in making disallowance of Employees Contribution to PF of Rs.30,49,649/ 1961.” against order dated 12.08.2022 passed by the Income In short the ‘Tribunal’) in ITA No. 241/Mum/2022 for assessment year 2018-19. In the case of Daryapur Shetkari i Ginning and Pressing Factory v. ACIT (2021) 320 CTR Hon’ble Bombay High court , has held that period of limitation for section 254(2) of the Act would commence from date when affected party got knowledge of decision in question and it t commence from date when order was passed. of Tribunal was received by the Pr. Commissioner 1 (in short ‘the PCIT’) on 22.11.2022 and miscellaneous application has been filed on 23.03.2023 within the period of six months from the date of receipt of the Principal Commissioner of Income Miscellaneous Application is within limitation period as held by the Hon’ble Bombay High Court in the case of Daryapur Shetkari Sahakari Ginning and Pressing Factory (supra) , admitted for adjudication. In the miscellaneous application, the Revenue has prayed for recalling the ground No. 1 (one) of the appeal, therefore, for ready , said ground is reproduced as under: On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in restricting the action of Learned Assessing Officer in making disallowance of Employees Contribution to PF of Rs.30,49,649/ - u/s.36(1)(va) of the Income Tax Act, M/s JSW Cement Ltd. 2 M.A No. 252/Mum/2023 ITA No. 241/Mum/2022 Income-tax Appellate in ITA No. 241/Mum/2022 for Daryapur Shetkari i Ginning and Pressing Factory v. ACIT (2021) 320 CTR Hon’ble Bombay High court , has held that period of limitation for section 254(2) of the Act would commence from date when affected party got knowledge of decision in question and it t commence from date when order was passed. The was received by the Pr. Commissioner 22.11.2022 and the miscellaneous application has been filed on 23.03.2023, which from the date of receipt of the Commissioner of Income-tax, the period as held by the Daryapur Shetkari d Pressing Factory (supra) ,hence, same is In the miscellaneous application, the Revenue has prayed for recalling the ground No. 1 (one) of the appeal, therefore, for ready On the facts and circumstances of the case as well as in law, the Learned CIT(A) has erred in restricting the action of Learned Assessing Officer in making disallowance of Employees Contribution to PF of u/s.36(1)(va) of the Income Tax Act, 2.1 The Ld. Departmental Representative (DR) addressing the grounds of the Miscellaneous Application submitted that has dismissed the ground no. 1 of the appeal deleting the made of Rs.30,49,645/ Bench of the Tribunal in the case of Harendra Nath Biswas v. DCIT (supra), which was made by the Assessing Officer invoking section 36(1)(va) of the Income DR submitted that in view of the decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. in Civil Appeal No. 2833 of 2016 dated 12.10.2022 towards EPF/ESI deposited under the relevant Act is only allowed for deduction u/s 36(1)(va) of the Act and any payment beyond the date prescribed under relevant Act is not allowable. Accordingly decision of the Supreme Court from record in the order of the Tribunal. 3. The Ld. Counsel of the assessee on the other hand objected for rectification on the basis of the subsequent order of the Hon’ble Supreme Court. 4. We have heard rival submission of dispute and perused the relevant material on record. We find that in the case, the Tribunal allowed the claim of the assessee for employee The Ld. Departmental Representative (DR) addressing the grounds of the Miscellaneous Application submitted that dismissed the ground no. 1 of the appeal deleting the made of Rs.30,49,645/- relying on the decision of the Co Bench of the Tribunal in the case of Harendra Nath Biswas v. DCIT which was made by the Assessing Officer invoking section 36(1)(va) of the Income-tax Act, 1961 (in short ‘the Act’) d that in view of the decision of the Hon’ble Supreme Checkmate Services Pvt. Ltd. in Civil Appeal No. 2833 of 2016 dated 12.10.2022 employee deposited on or before the due date prescribed ant Act is only allowed for deduction u/s 36(1)(va) of the Act and any payment beyond the date prescribed under relevant allowable. Accordingly, he submitted that in view of the decision of the Supreme Court (supra), there is a mistake apparent from record in the order of the Tribunal. The Ld. Counsel of the assessee on the other hand objected for rectification on the basis of the subsequent order of the Hon’ble We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that Tribunal in para 3 to 3.2 of the impugned order allowed the claim of the assessee for employee’s contribution to M/s JSW Cement Ltd. 3 M.A No. 252/Mum/2023 ITA No. 241/Mum/2022 The Ld. Departmental Representative (DR) addressing the grounds of the Miscellaneous Application submitted that Tribunal dismissed the ground no. 1 of the appeal deleting the addition relying on the decision of the Co-ordinate Bench of the Tribunal in the case of Harendra Nath Biswas v. DCIT which was made by the Assessing Officer invoking section tax Act, 1961 (in short ‘the Act’). The Ld. d that in view of the decision of the Hon’ble Supreme Checkmate Services Pvt. Ltd. in Civil Appeal employee’s contribution on or before the due date prescribed ant Act is only allowed for deduction u/s 36(1)(va) of the Act and any payment beyond the date prescribed under relevant he submitted that in view of the there is a mistake apparent The Ld. Counsel of the assessee on the other hand objected for rectification on the basis of the subsequent order of the Hon’ble the parties on the issue in dispute and perused the relevant material on record. We find that in para 3 to 3.2 of the impugned order s contribution to EPF/ESI deposited beyond the du Acts, following the decision of the Tribunal in the case of Harendra Nath Biswas (supra) Supreme Court in the case of (supra) has held that employee’s con beyond the due date prescribed under relevant Acts is not allowable under section 36(1)(va) of the Act. The Hon’ble Supreme Court has interpreted the law on the issue of disallowance contribution to ESI/EPF which the relevant provision decision of the Hon’ble Supreme Court operates retrospectively unless specifically directed to act as prospectively. Since in the case of Checkmate Services Pvt. Ltd. (supra) has not given any specific direction for operation of the decision as prospective and therefore same operates retrospectively from the date of the inception decision of the Tribunal on the issue of disallowance of employee’s contribution to ESI/EPF u/s 36(1)(va) of the Act being contrary to the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. (supra) Accordingly, we recalled the appeal to the extent of the issue of the disallowance of employee’s contribution to Rs.30,49,649/- u/s 36(1)(va) of the Act. application of the Revenue is accordingly allowed. beyond the due date prescribed under relevant ollowing the decision of the Tribunal in the case of Harendra Nath Biswas (supra). But, we find that subsequently in the case of Checkmate Services Pvt. Ltd. held that employee’s contribution to EPF/ESI deposited beyond the due date prescribed under relevant Acts is not allowable under section 36(1)(va) of the Act. The Hon’ble Supreme Court has interpreted the law on the issue of disallowance contribution to ESI/EPF u/s 36(1)(va) of the Act from the date which the relevant provisions have been introduced in the Act. The decision of the Hon’ble Supreme Court operates retrospectively unless specifically directed to act as prospectively. Since in the case vices Pvt. Ltd. (supra), the Hon’ble Supreme Court has not given any specific direction for operation of the decision as prospective and therefore same operates retrospectively from the inception of the relevant provisions in the ision of the Tribunal on the issue of disallowance of employee’s contribution to ESI/EPF u/s 36(1)(va) of the Act being contrary to the decision of Hon’ble Supreme Court in the case of Checkmate (supra), it is a mistake apparent from rec we recalled the appeal to the extent of the issue of the employee’s contribution to u/s 36(1)(va) of the Act. The miscellaneous application of the Revenue is accordingly allowed. M/s JSW Cement Ltd. 4 M.A No. 252/Mum/2023 ITA No. 241/Mum/2022 e date prescribed under relevant ollowing the decision of the Tribunal in the case of Harendra that subsequently Hon’ble Checkmate Services Pvt. Ltd. tribution to EPF/ESI deposited beyond the due date prescribed under relevant Acts is not allowable under section 36(1)(va) of the Act. The Hon’ble Supreme Court has interpreted the law on the issue of disallowance of employee’s 36(1)(va) of the Act from the date on introduced in the Act. The decision of the Hon’ble Supreme Court operates retrospectively unless specifically directed to act as prospectively. Since in the case the Hon’ble Supreme Court has not given any specific direction for operation of the decision as prospective and therefore same operates retrospectively from the of the relevant provisions in the Act. Thus, ision of the Tribunal on the issue of disallowance of employee’s contribution to ESI/EPF u/s 36(1)(va) of the Act being contrary to the decision of Hon’ble Supreme Court in the case of Checkmate a mistake apparent from record. we recalled the appeal to the extent of the issue of the employee’s contribution to ESI/EPF of The miscellaneous 4.1 Since both the parties agreed to argue the issue and therefore, we have heard the submissions appeal. Since, the issue of disallowance of to ESI/EPF deposited after due date prescribed under the relevant Act has been upheld by the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. (supra) following the same the ground No. 1 of the appeal of the assessee is dismissed. 5. In the result, the Miscellaneous Application of the Revenue is allowed. The appeal of the assessee to the extent of ground No. 1 is dismissed as indicated above. Order pronounced in the open Court on Sd/ (VIKAS AWASTHY JUDICIAL MEMBER Mumbai; Dated: 08/09/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// he parties agreed to argue the issue and therefore, we have heard the submissions of the parties on ground no. 1 of the . Since, the issue of disallowance of employee’s contribution PF deposited after due date prescribed under the relevant t has been upheld by the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. (supra) , therefore, respectfully following the same the ground No. 1 of the appeal of the assessee is In the result, the Miscellaneous Application of the Revenue is The appeal of the assessee to the extent of ground No. 1 is dismissed as indicated above. Order pronounced in the open Court on 08/09/2023. Sd/- VIKAS AWASTHY) (OM PRAKASH KANT CIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai M/s JSW Cement Ltd. 5 M.A No. 252/Mum/2023 ITA No. 241/Mum/2022 he parties agreed to argue the issue and therefore, of the parties on ground no. 1 of the employee’s contribution PF deposited after due date prescribed under the relevant t has been upheld by the Hon’ble Supreme Court in the case of therefore, respectfully following the same the ground No. 1 of the appeal of the assessee is In the result, the Miscellaneous Application of the Revenue is The appeal of the assessee to the extent of ground No. 1 is 09/2023. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, Registrar) ITAT, Mumbai