ACIT,Cir. 12(1), Kolkata V. Naveen Merico Engineering Co. Pvt. Ltd. , Kolkata

MA 3/KOL/2023

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 4515 (ITAT-KOLKATA)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-12-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-12-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 10-01-2023
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 254(2)

Judgement Text

M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 1 IN THE INCOME TAX APPELLATE TRIBUNAL, ‘A’ BENCH, KOLKATA Before Shri Rajpal Yadav, Vice-President (KZ) & Shri Rajesh Kumar, Accountant Member M.A. No. 3/KOL/2023 (in I.T.A. No. 424/KOL/2021) Assessment Year: 2017-2018 Assistant Commissioner of Income Tax,....Applicant Circle-12(1), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 -Vs.- Naveen Merico Engineering Co. Pvt. Ltd.,..Respondent 238/A, A.J.C. Bose Road, 3 rd Floor, Kolkata-700020 [PAN: AADCM5934H] Appearances by: N o n e, appeared on behalf of the assessee Shri B.K. Singh, JCIT, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing : December 22, 2023 Date of pronouncing the order : December 22, 2023 O R D E R Per Rajpal Yadav, Vice-President (KZ):- The present Miscellaneous Application is directed at the instance of Revenue pointing out an apparent error M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 2 in the order of the Tribunal dated 24 th May, 2022 passed in ITA No. 424/KOL/2021. 2. It is pleaded in the application that the assessee failed to deposit the Employees’ contributions to the respective PF & ESI Account within the due date provided under those Acts. Since the employees’ contribution was deposited before the due date of filing of the appeal, therefore, the Tribunal followed the decision of the Hon’ble Jurisdictional High Court in the case of CIT –vs.- Vijayshree Ltd. in ITAT No. 243 of 2011 & G.A. No. 26607 of 2011. Apart from that decision, Tribunal has made reference to a large number of orders passed by the ITAT and allowed the appeal of assessee. Tribunal has deleted the disallowance. The Revenue has pleaded that position of law has been changed by the subsequent decision of the Hon’ble Supreme Court in the case of Checkmate Services (P) Limited -vs.- Commissioner of Income Tax reported in 143 taxmann.com 178 (SC), whereby it has been held that if employees’ contribution is being not paid within the due date provided in the PF & ESI Acts, then, the assessee will not be entitled for deduction. 3. We have heard this Miscellaneous Application on earlier occasion and thereafter re-fixed it by observing as under:- “26.05.2023: The present Miscellaneous Application is directed at the instance of Revenue pointing out an M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 3 apparent error in the order of the Tribunal dated 24 th May, 2022 passed in ITA No. 424/KOL/2021. 2. It is pleaded in the Miscellaneous Application that Tribunal has deleted the disallowance out of employees’ contribution on the ground that payment was made to respective P.F. and ESI Act before the due date of filing of the return under section 139(1). According to the Revenue, this position of law has been changed after the decision of the Hon’ble Supreme Court and, therefore, the order of the Tribunal is to be termed as suffering from an apparent error. In response to the notice of hearing, no one appeared on behalf of the assessee. 3. While dictating the order, it came to our notice that Miscellaneous Application is time-barred by 41 days. This fact was not brought to our notice by the ld. D.R. at the time of hearing. Prima facie, it is to be observed that there is no power to condone such delay. At the time of original hearing, ld. Counsel Mr. Shital Khemka, C.A. appeared and his Power of Attorney including his mobile number is available on the record. Therefore, we release this Miscellaneous Application for a fresh hearing on the above issue and direct the Registry to serve a notice upon the assessee including by informing both the ld. Counsels, whose Power of Attorney is available on the original record. Such information be given through telephonic conversation. The Registry is directed to list the Miscellaneous Application in regular course after service of notice to the parties. Copy of this Order-sheet be supplied to the Department. Sd/- Sd/- (Rajesh Kumar) (Rajpal Yadav) Accountant Member Vice-President (KZ) 4. The Bench Clerk has noticed on the Order-sheet that this order was duly communicated to the ld. Counsel for the assessee. But inspite of that, neither on the earlier occasion nor in the fresh hearing anybody has appeared on behalf of the assessee. In order to explain the alleged objection of the Tribunal that M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 4 Miscellaneous Application is prima facie time-barred, the Department has filed a Certificate from the ld. Principal CIT (Central)-2, Kolkata, which reads as under:- OFFICE OF THE PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL), KOLKATA-2, KOL, 110, Shanti Pally, Aavakar Bhawan Poorva, Kolkata- 700 107. No. Pr.CIT(C)/Kol-2/Hqrs/MA/2022-23/5587 Dated: 09.01.2023 CERTIFICATE 1. It is certified that appellate order in ITA No. 424/Kol/2021 dated 24/05/2022 of ITAT, Kolkata in the case of M/s. Naveen Merico Engineering Co. Pvt. Ltd.(PAN-AADCM5934H) for the A.Y. 2017-18 was received by this office on 26/12/2022. 2. Further, I have authorized DCIT,CC-4(4), Kolkata to file a Misc. Application u/s 254(2) of the Income Tax Act,1961 relating to ITA No. 424/Kol/2021 dated 24/05/2022 passed by ITAT, Kolkata in this case of M/s. Naveen Merico Engineering Co. Pvt. Ltd.(PAN- AADCM5934H) for the A.Y. 2017- 18. Sd/- ( RAM BILAS MISHRA ) PR.COMMISSIONER OF INCOME TAX(CENTRAL)-2. KOLKATA 5. With the assistance of ld. D.R., we have gone through the record carefully. Rule 35 Income Tax Appellate Tribunal Rules contemplates that Tribunal is required to communicate the copy of the order. This Rule reads as under:- Order to be communicated to parties:- Rule 35: The Tribunal shall, after the order is signed, cause it to be communicated to the assessee and to the Commissioner. M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 5 As per the record, the order has been communicated on 26.12.2022 and we are of the view that this date of communication is to be construed as the date for counting the limitation for filing a Miscellaneous Application. It is pertinent to observe that in all other judicial proceedings, orders are only to be pronounced and not to be communicated to the parties. They were required to apply for a Certified Copy of the order and, therefore, the time consumed in availing the Certified Copy of the order always to be excluded from the period of limitation. However, in the functioning of the ITAT, it is procedurally provided that order is to be communicated by the Tribunal to the parties and, therefore, limitation is to be counted from the communication of the order and not from the pronouncement. The Hon’ble Supreme Court in the case of ACIT –vs.- Saurashtra Kutch Stock Exchange Limited reported in 305 ITR 227 has propounded that a subsequent decision of the Hon’ble Jurisdictional High Court or of the Hon’ble Supreme Court explaining the position of law would term the Tribunal’s order if contrary to that position of law as suffering from an apparent error. The simple reason for such a proposition is that the Court decides a dispute between the parties. The cause can involve decision on facts. It can also involve a decision on point of law. Both may have bearing ultimate result of the case. When a Court interprets a M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 6 provision, it decides as to what is the meaning and effects of the words used by the legislature. It is declaration regarding the Statute. In other words, the judgment declares as to what the legislature had said at the time of promulgation of the law, the decision is this was the law, this is the law, this is how the provision shall be construed. After the decision of the Hon’ble Supreme Court in the case of Checkmate Services (P) Limited -vs.- Commissioner of Income Tax reported in 143 taxmann.com 178 (SC), it is to be construed that at the time when the Tribunal has decided the appeal of the assessee. The law should be that if an assessee failed to deposit the PF & ESI contributions within the due date of limitation provided in PF & ESI Acts, then, the assessee will not be entitled to claim the deduction. Therefore, the order of the Tribunal is suffering from an apparent error. We re-call the order of the Tribunal and restore the appeal to its original number. The Registry is directed to list the appeal for fresh hearing in due course. 6. In the result, the Miscellaneous Application of the Department is allowed. Sd/- Sd/- (Rajesh Kumar) (Rajpal Yadav) Accountant Member Vice-President (KZ) Kolkata, the 22 nd day of December, 2023 M.A. 3/KOL/2023 (in ITA No. 424/KOL/2021) A.Y. 2017-2018 Naveen Merico Engineering Co. Pvt. Ltd. 7 Copies to :(1) Assistant Commissioner of Income Tax, Circle-12(1), Kolkata, Aayakar Bhawan, P-7, Chowringhee Square, Kolkata-700069 (2) Naveen Merico Engineering Co. Pvt. Ltd., 238/A, A.J.C. Bose Road, 3 rd Floor, Kolkata-700020 (3) Commissioner of Income Tax (Appeals),, National Faceless Appeal Centre (NFAC), Delhi; (4) CIT- , Kolkata (5) The Departmental Representative (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S.