ITO 13(1)(1), MUMBAI V. 3S INTEGRATED FACILITY MANGEMENT PVT. LTD., MUMBAI

MA 43/MUM/2023

AI Insights

The case involves 3S Integrated Facility Management Pvt. Ltd., which faced disallowance of employee's contributions to the provident fund and ESIC for the assessment years 2018-19 and 2019-20. Initially, the Tribunal had dismissed the appeals by the AO, but following the Supreme Court's ruling in Checkmate Services Pvt. Ltd. vs CIT, which clarified the non-allowability of such contributions if not deposited within the prescribed due dates, the Tribunal recalled its earlier orders and allowed the AO's appeals. The Tribunal's decision was based on the precedent set by the Supreme Court, emphasizing the importance of adhering to statutory deadlines for contributions under the Provident Fund Act.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 299210 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-07-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 20-04-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 16-01-2023
• Other Referred Cases: Checkmate Services Pvt. Ltd. Vs CIT
• Laws Referred To: Provident Fund Act, ESIC Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 43

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “E” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND SHRI RAHUL CHAUDHARY, JM MA No. 43/Mum/2023 (Assessment Year 2018-19) (Arising Out of ITA No. 2491/Mum/2021) MA No. 44/Mum/2023 (Assessment Year 2019-20) (Arising Out of ITA No. 2492/Mum/2021) & ITA No. 2491 & 2492 /Mum/2021 AY 2018-19 & 2019-20 IT O , 1 3 ( 1 ) ( 1 ) R o om N o . 2 2 5 , A a ya k a r B h a v a n , M. K . R o a d , Mu m b a i-4 0 0 0 2 0 Vs. 3S Intergrated Facility Management Pvt. Ltd. 108, Ruby Industrial Estate, Chincholi Bunder Road, Off. New Link Road, Malad (W) Mumbai-400064 (Appellant) (Respondent) PAN No. AAACZ8848E Assessee by : None Revenue by : Shri Mahita Nair, DR. Date of hearing: 21.04.2023 Date of pronouncement : 11.07.2023 O R D E R PER PRASHANT MAHARISHI, AM: 01. Ld. AO has preferred these two miscellaneous applications in ITA No. 2491/Mum/2021 for assessment year 2018-19 and ITA No. 2492/Mum/2021 for assessment year 2019-20 wherein by order dated 23.05.2022 Appeals filed by the Ld. AO were dismissed. Page | 2 MA No. 43 & 44/ MUM/2023 A.Y. 2018-19 & 2019-20 3S INTERGRATED FACILITY MANAGEMENT PVT. LTD. 02. The solitary issue covered in those appeals was the disallowance of employee’s contribution to the provident fund and ESIC Act which was not deposited within the due date prescribed under the respective PF statutes but paid before the due date of filing of return of income. The co-ordinate bench dismissed the appeal of the ld AO for assessment year 2018-19 deleting the disallowance of ₹02,74,34,450/- and identically for assessment year 2018-19 of ₹2,74,92,659/-. 03. The miscellaneous application states that in view of the decision of the Hon’ble Supreme Court in case of Checkmate Services Pvt. Ltd. Vs CIT dated 12.10.2022 the above mentioned order of the co-ordinate bench suffers from the mistake and therefore the impugned order needs to be recalled. 04. Ld. Departmental Representative supported the contention of the miscellaneous application. 05. None appeared on behalf of the assessee despite notice on the date of hearing i.e. 21.04.2023. On earlier occasion also on 31.03.2023, none appeared on behalf of the assessee; therefore these miscellaneous applications are decided on its merit. 06. Now the Ld. AR has pointed out that decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. [2022] 143 taxmann.com 178 (SC)/[2023] 290 Taxman 19 (SC) clearly shows that order was erroneous. The Ld. Departmental Representative also submitted that several such orders have been recalled by the co-ordinate benches based on MA application filed by revenue. Accordingly, we find that the order of the co-ordinate bench for those two assessment years allowing the appeal of the assessee suffers from the mistake Page | 3 MA No. 43 & 44/ MUM/2023 A.Y. 2018-19 & 2019-20 3S INTERGRATED FACILITY MANAGEMENT PVT. LTD. and therefore we recall the order passed in the case of the assessee for both the years. 07. Thus, the miscellaneous application filed by the Ld. AO for both the years are allowed. ITA No. 2491 & 2492 /Mum/2021 AY 2018-19 & 2019-20 are recalled. ITA No. 2491 & 2492 /Mum/2021 AY 2018-19 & 2019-20 08. As we already recalled the order of the co-ordinate bench in the above court ITA preferred by the LD AO for assessment years 2018-19 & 2019-20, those ITAs are also covered against the assessee by the decision of the Hon’ble Supreme Court in case of Checkmate Services Pvt. Ltd. [2022] 143 taxmann.com 178 (SC)/[2023] 290 Taxman 19 (SC) wherein it has been held that if employees’ contribution of provident fund Act is not paid before due date prescribed u/s 38 of the Provident Fund Act, despite the above sum paid before due date of filing the return of income, is not allowable. Therefore, based on the above decision of the Hon’ble Supreme Court the appeal of the LD AO are sustainable and deserves to be allowed. Accordingly, these two appeals recalled are allowed. 09. In the result both these miscellaneous applications filed by the Ld. AO and consequent recalled appeal filed by the LD AO are also allowed. Order pronounced in the open court on 11.07.2023. Sd/- Sd/- (RAHUL CHAUDHARY) (PRASHANT MAHARISHI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Mumbai, Dated: 11.07.2023 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant Page | 4 MA No. 43 & 44/ MUM/2023 A.Y. 2018-19 & 2019-20 3S INTERGRATED FACILITY MANAGEMENT PVT. LTD. 2. The Respondent. 3. The CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Mumbai