Appeal details
Counselvise Citation
[2023] 101 COUNSELVISE.COM (IT) 0610 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 month(s) 23 day(s)
Appellant
Respondent
Appeal Type
Miscellaneous Application
Pronouncement Date
22-05-2023
Appeal Filed By
Department
Order Result
Allowed
Bench Allotted
E
Next Hearing Date
23-02-2023
Assessment Year
2018-2019
Appeal Filed On
29-12-2022
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL "E" BENCH, MUMBAI SHRI B.R. BASKARAN, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER MA No. 446/MUM/2022 (Arising out of ITA No. 1577/Mum/2021) (Assessment Year: 2018-19) Deputy Commissioner of Income Tax 17(1), Mumbai 117, Kautilya Bhawan, BKC, Bandra (East), Mumbai - 400051 Mahendra Samat Gala, 502, Shanti Niketan, Dixit Road, Vile Parle (E), Mumbai - 400057 ............... Vs ................ Appellant Respondent [PAN: AAMPG0757A) Appearance For the Appellant/Department For the Respondent/Assessee : : Ms. Mahita Nair Shri Pratik Jain Date Conclusion of hearing Pronouncement of order : : 24.02.2023 23.05.2023 O R D E R Per Rahul Chaudhary, Judicial Member: 1. The present Miscellaneous Application has been filed by the Revenue for rectification of order, dated 07/07/2022, passed by the Tribunal in ITA No. 1577/Mum/2021, pertaining to the Assessment Year 2018-19. 2. We have heard the rival contention and perused the material on record. Vide order, dated 07.07.2022, the appeal preferred by the Assessee was allowed and the addition of INR 11,22,426/- on account of delay of 3-5 days in depositing the Employees’ MA No. 446/Mum/2022 Assessment Year : 2018-19 2 Contribution to Employees’ State Insurance was deleted as the aforesaid deposit, though made after the expiry of the due date specified in the relevant statute, was made before due date of filing income tax return prescribed under Section 139(1) of the Act. 3. Subsequently, in the case of Checkmate Services Private Ltd. v. CIT- 1:[2022] 448 ITR 518 (SC)[12-10-2022], the Hon’ble Supreme Court has held that where an assessee failed to deposit Employees' Contribution towards Provident Fund and Employees’ State Insurance within due date prescribed in respective statutes, deduction under Section 36(1)(va) of the Act was not allowable. The non-obstante clause contained in Section 43B of the Act would not apply in the case of Employees’ Contribution deducted from the salary of employees and held in trust by assessee-employer. Therefore, such assessee-employer would not be absolve from the liability to deposit Employees’ Contribution on or before the due date specified in the respective statutes as a pre-condition for claiming deduction under Section 36(1)(va) of the Act. Explanation 2 inserted by way of Finance Act, 2021 (with effect from 01/04/2021) providing that the provisions of Section 43B of the Act shall be deemed never to have been applied for the purpose of determining the ‘due date’ under Section 36(1)(va) of the Act is now stands aligned with the position of law as declared by the Hon’ble Supreme Court. 4. The subsequent decision of the Hon’ble Supreme Court can validly form the basis for rectification under Section 254 of the Act in view of the judgment of the Hon’ble Supreme Court in the case of Assistant Commissioner of Income Tax, Rajkot Vs. Saurashtra Kutch Stock Exchange Ltd.: 2008] 305 ITR 227 (SC) and the decisions of the Tribunal in the case of Kailashnath Malhotra Vs. Joint MA No. 446/Mum/2022 Assessment Year : 2018-19 3 Commissioner of Income-tax, Special Range 56, Mumbai [2009] 34 SOT 541 (Mum.) (TM), and Assistant Commissioner of Income-tax Vs. Hughes Services (FE) Pte. Ltd.: [2009] [2005] 93 ITD 77 (Delhi)(TM). 5. The view taken by the Tribunal, vide order dated 07/07/2022, being contrary to view taken by the Hon’ble Supreme Court in the case of Checkmate Services Private Ltd. (supra) constitutes a mistake apparent on record. Accordingly, we allow the rectification application preferred by the Revenue. The appeal stands restored to its original number. The registry is directed to list the appeal for hearing before the regular bench in due course after notice to the parties. 6. In result, the Miscellaneous Application is allowed. Order pronounced on 23.05.2023. Sd/- Sd/- (B.R. Baskaran) Accountant Member (Rahul Chaudhary) Judicial Member म ुंबई Mumbai; दिन ुंक Dated : 23.05.2023 Alindra, PS MA No. 446/Mum/2022 Assessment Year : 2018-19 4 आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आय क्त/ The CIT 4. प्रध न आयकर आय क्त / Pr.CIT 5. दिभ गीय प्रदिदनदध, आयकर अपीलीय अदधकरण, म ुंबई / DR, ITAT, Mumbai 6. ग र्ड फ ईल / Guard file. आिेश न स र/ BY ORDER, सत्य दपि प्रदि //True Copy// उप/सह यक पुंजीक र /(Dy./Asstt. Registrar) आयकर अपीलीय अदधकरण, म ुंबई / ITAT, Mumbai
AI Insights
The case involves a Miscellaneous Application by the Revenue seeking rectification of an earlier Tribunal order that had allowed the Assessee's appeal, which pertained to the late deposit of Employees' Contribution to Employees' State Insurance. Initially, the Tribunal had deleted the addition of INR 11,22,426, as the deposit was made before the due date for filing the income tax return. However, following the Supreme Court's decision in Checkmate Services Private Ltd. v. CIT-1, which clarified that deductions for late deposits of Employees' Contributions are not allowable, the Revenue filed for rectification. The Tribunal acknowledged the Supreme Court's precedent and rectified its earlier decision, restoring the appeal for re-examination.
