Rahul Coke Pvt. Ltd., Kolkata V. ACIT, Cir. 5(1), Kolkata

MA 36/KOL/2022

AI Insights

The case involves Rahul Coke Pvt. Ltd., which filed miscellaneous applications under section 254(2) of the Income-tax Act, 1961, seeking corrections in the Tribunal's earlier order regarding disallowances made for unpaid bonuses and contributions to PF & ESI for the Assessment Years 2017-18 and 2018-19. The Tribunal initially did not adjudicate on the disallowance of unpaid bonuses and incorrectly stated the figures for disallowances related to PF & ESI contributions. Upon review, the Tribunal corrected the figures for PF & ESI contributions but upheld the disallowance due to late deposit as per the Supreme Court's ruling. However, the disallowance of unpaid bonuses was deleted as the payments were made before the due date of filing the return.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 136114 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Appeal Filed On: 06-09-2022
• Other Referred Cases: Lumino Industries Ltd. vs. ACIT, Circle-5(1), Kolkata, Chekmate Services Pvt. Ltd. Vs. CIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 43B; 139(1); 254(2)

Judgement Text

। आयकर अपीलीय अिधकरण ᭠यायपीठ, कोलकाता । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA BEFORE SHRI MANISH BORAD, HON’BLE ACCOUNTANT MEMBER & SHRI SANJAY GARG, HON’BLE JUDICIAL MEMBER M.A. No. 36/Kol/2022 A/o I.T.A. No. 459/Kol/2021 Assessment Year: 2017-18 & M.A. No. 37/Kol/2022 A/o I.T.A. No. 460/Kol/2021 Assessment Year: 2018-19 Rahul Coke Pvt. Ltd. 27A, Rowland Road Chandra Shekhar Building 1 st Floor Room No. 102B Kolkata - 700020 PAN : AABCR1868B Vs ACIT/DCIT, Circle-5(1) Kolkata अपीलाथᱮ/ (Appellant) ᮧ᭜ यथᱮ/ (Respondent) Assessee by : Shri Sanjay Bajoria, FCA Revenue by : Shri P.P. Barman, Addl. CIT सुनवाई कᳱ तारीख/Date of Hearing : 18/11/2022 घोषणा कᳱ तारीख /Date of Pronouncement: 03/01/2023 आदेश/O R D E R PER SHRI MANISH BORAD, AM : The present miscellaneous applications u/s 254(2) of the Act are directed against the order of the Tribunal dt. 04/03/2022 for Assessment Year 2017-18 & 2018-19. 2. The ld. Counsel for the assessee referring to the contents of the miscellaneous application stated that in ITA No. 459 & 460/Kol/2021, the common issue was raised in Ground No. 1 challenging the disallowance made u/s 43B of the Act for the unpaid bonus of Rs.3,00,270/- and Rs.2,13,389/-. However, inadvertently Hon’ble Tribunal did not adjudicate this in Ground No. 1 for both the years. Further it was submitted in para 2 of the impugned order, the figure of disallowance in respect of employees M.A. No. 36/Kol/2022 A/o I.T.A. No. 459/Kol/2021 Assessment Year: 2017-18 & M.A. No. 37/Kol/2022 A/o I.T.A. No. 460/Kol/2021 Assessment Year: 2018-19 Rahul Coke Pvt. Ltd. 2 contribution towards PF & ESI are mentioned at Rs.3,05,711/- for Assessment Year 2017-18 and for Assessment Year 2018-19 at Rs.2,22,975/-. However, the correct figure of disallowance are Rs.5,441/- & Rs.9,586/- for Assessment Years 2017-18 & 2018-19 respectively; and the impugned order needs necessary correction. 3. Per contra, the ld. D/R did not raise any objection to the contentions made by the ld. Counsel for the assessee. 4. We have heard rival contentions and perused the record placed before us. 5. Certain apparent errors have been pointed out by the ld. Counsel for the assessee through these miscellaneous applications. So far as the first grievance relevant to incorrect figures mentioned in para 2 of the impugned order, we find merit in the contention of the ld. Counsel for the assessee and find that the correct figure of disallowance of contribution to PF & ESI are Rs.5,441/- & Rs.9,586/- for Assessment Years 2017-18 & 2018-19 respectively. Therefore, in para 2 of the impugned order, the correct figures are incorporated and the same is reproduced below:- “2. The sole ground involved in these appeals of assessee is against the action of the ld. CIT(A) in confirming the disallowance made in respect of PF & ESI in respect employees' contribution u/s. 36(1) (va) r.w.s. 2(24)(*) of the Income-tax Act, 1961 (hereinafter referred to as the "Act") of Rs.5,441/- for AY 2017-18 and Rs.9,586/- for AY 2018-19. At the outset, the ld. Counsel for the assessee submitted that under the given facts, issue raised is covered in favour of the assessee by the decision of this Tribunal in the case of Lumino Industries Ltd. vs. ACIT, Circle-5(1), Kolkata in ITA. No.365/Kol/202 1l for AY 2015-16 order dated 17.11.2021.” M.A. No. 36/Kol/2022 A/o I.T.A. No. 459/Kol/2021 Assessment Year: 2017-18 & M.A. No. 37/Kol/2022 A/o I.T.A. No. 460/Kol/2021 Assessment Year: 2018-19 Rahul Coke Pvt. Ltd. 3 6. We notice that the issue of disallowance of contribution to PF & ESI for being deposited after the due date prescribed under the relevant Acts came up for adjudication before the Hon’ble Supreme Court in the Chekmate Services Pvt. Ltd. Vs. CIT (2022) 143 taxmann.com 178 (SC) dated 12.10.2022, wherein the Hon’ble Apex Court held in favour of the revenue that strict compliance with Section 36(1)(va) r.w.s. 2(24) of the Act is must to claim deduction and Section 43B of the Act cannot be applied. As per the ratio laid down by the Hon’ble Apex Court, the disallowance of contribution to PF & ESI at Rs.5,441/- and Rs.9,586/- in the instant case deserve to be confirmed since there was a delay in deposit of the said amount as per the due dates provided under the respective Act governing PF & ESI. 7. However, since at the time of hearing of the main appeals involved in ITA Nos. 459 & 460/Kol/2021 on 18/11/2022, this judgment of the Hon’ble Supreme Court was not pronounced, we decided in favour of the assessee following the decision of the Co-ordinate Bench of ITAT Kolkata in the case of Lumino Industries Ltd. vs. ACIT in ITA No. 365/Kol/2021 order dt. 17/11/2021 and on observing that since the alleged amount was deposited before the due date of filing of return of income u/s 139(1) of the Act, the alleged amount does not call for disallowance. However, since the law is settled by the Hon’ble Apex Court and as discussed above the alleged amount of employees’ contribution to PF & ESI deserves to be disallowed. Accordingly, paras 4 & 5 of the order needs to be replaced by the following:- “4. In view of the ratio laid down by the Hon’ble Apex Court in the case of Chekmate Services Pvt. Ltd. Vs. CIT (2022) 143 taxmann.com 178 (SC) dated M.A. No. 36/Kol/2022 A/o I.T.A. No. 459/Kol/2021 Assessment Year: 2017-18 & M.A. No. 37/Kol/2022 A/o I.T.A. No. 460/Kol/2021 Assessment Year: 2018-19 Rahul Coke Pvt. Ltd. 4 12.10.2022, since there a delay in deposit of employees’ contribution towards PF & ESI and the assessee failed to deposit the said sum before the due date prescribed in the governing Acts, the ld. CIT(A) has rightly confirmed the disallowance made by the Assessing Officer. 5. Thus, Ground No. 2 raised for Assessment Year 2017-18 and 2018-19 are dismissed.” 8. As regards the second contention of the ld. Counsel for the assessee that Ground No. 1 raised for Assessment Year 2017-18 & 2018-19, needs to be adjudicated, we fid that the assessee has raised the issue of disallowance of unpaid bonus at Rs.3,00,270/- & Rs.2,13,389/- in Ground No. 1 raised for both the Assessment Year. Perusal of the impugned order shows that this amount remains to be adjudicated. The ld. Counsel for the assessee during the course of hearing stated that the said disallowance deserves to be deleted as the unpaid bonus were paid to the employees before the due date of filing of return and necessary verification can be made from the evidence filed in the paper book including certificate Confirming payment of bonus within time allowed u/s 43B of the Act. The Id. D/R failed to controvert these facts. 9. We have heard rival contentions and on perusal of these details we find that the unpaid bonus outstanding at the close of the year had been duly paid before the due date of filing of return u/s 139(1) of the Act and, therefore, no disallowance was called for u/s 43B of the Act. We, therefore, delete the said disallowance of Rs.3,00,270/- & Rs.2,13,389/- for Assessment Year 2017-18 & 2018-19 and allow Ground No. 1 raised by the assessee for both the Assessment Years. M.A. No. 36/Kol/2022 A/o I.T.A. No. 459/Kol/2021 Assessment Year: 2017-18 & M.A. No. 37/Kol/2022 A/o I.T.A. No. 460/Kol/2021 Assessment Year: 2018-19 Rahul Coke Pvt. Ltd. 5 10. In the result, both the miscellaneous applications filed by the assessee are allowed in terms indicated hereinabove. This order be treated as part and parcel of the main order dated 04/03/2022 Order pronounced in the Court on 3 rd January, 2023 at Kolkata. Sd/- Sd/- (SANJAY GARG) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER Kolkata, Dated 03/01/2023 *SC SrPs आदेश कᳱ ᮧितिलिप अᮕेिषत/Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant 2. ᮧ᭜यथᱮ / The Respondent 3. संबंिधत आयकर आयुᲦ / Concerned Pr. CIT 4. आयकर आयुᲦ)अपील (/ The CIT(A)- 5. िवभागीय ᮧितिनिध ,आयकर अपीलीय अिधकरण, कोलकाता/DR,ITAT, Kolkata, 6. गाडᭅ फाईल /Guard file. आदेशानुसार/ BY ORDER, TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Kolkata