Appeal details
Counselvise Citation
[2024] 100 COUNSELVISE.COM (IT) 3453 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 month(s) 11 day(s)
Appellant
Respondent
Appeal Type
Miscellaneous Application
Pronouncement Date
07-03-2024
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Next Hearing Date
04-01-2024
Assessment Year
2018-2019
Appeal Filed On
25-12-2023
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI SHRI PRASHANT MAHARISHI , ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER MA No. 647/MUM/2023 (Arising out of ITA No. 1858/Mum/2022) (Assessment Year: 2018-19) Nirmal Bang Securities Pvt. Ltd., B-2, Marathon Innova, Opp. Peninsula Building, Ganpatrao Kadam Marg, Lower Parel (West), Mumbai - 400013 [PAN: AAACN7369L] ................ Assessee Deputy Commissioner of Income Tax, Centralized Processing Centre, Bengaluru - 560500 Vs ................ Respondent Appearance For the Assessee/Assessee For the Respondent/Department : : Shri Anant Pai Shri Ashok Kumar Ambastha Date Conclusion of hearing Pronouncement of order : : 05.01.2024 08.03.2024 O R D E R Per Rahul Chaudhary, Judicial Member: 1. The present Miscellaneous Application has been filed by the Assessee for rectification of order, dated 26/09/2023, passed by the Tribunal in ITA No. 1858/Mum/2022, pertaining to the Assessment Year 2018-2019. 2. The Learned Authorised Representative for the Assessee submitted that ITA No. 1858/Mum/2022 was earlier disposed off vide order, MA No. 647/Mum/2023 Assessment Year: 2018-19 2 dated 23/09/2022. Subsequently, in Miscellaneous Application No. 302/Mum/2023 filed by the Revenue, the order dated 23/09/2022 was recalled only in connection with the issue of disallowance of INR 25,08,096/- under Section 36(1)(va) of the Act vide order, dated 11/08/2023. Thus, all the other issues raised in appeal before the Tribunal in ITA No. 1858/Mum/2022 stood settled. Since the Tribunal has not taken into consideration the aforesaid orders dated 23/09/2022 and 11/08/2023, mistake apparent on record had crept in the order dated 26/09/2023, passed by the Tribunal leading to opening of issues otherwise settled vide order, dated 23/09/2022, passed by the Tribunal. The Ld. Authorised Representative for the Assessee further submitted that as per order dated 11/08/2023 the issue for consideration before the Tribunal was regarding Assessee’s claim for deduction for INR 25,08,096/- under Section 36(1)(va) read with Section 43B of the Act in respect of Employees’ Contribution to Provident Fund and Employees’ State Insurance Corporation deposited after lapse of time prescribed in the applicable statute but before the due date of filing return specified under Section 139(1) of the Act. The Ld. Authorised Representative for the Assessee fairly submitted that the aforesaid issue stood decided against the Assessee by the judgment of the Hon’ble Supreme Court in the case of Checkmate Services Private Ltd. v. CIT-1:[2022] 448 ITR 518 (SC)[12-10-2022]. 3. The Learned Departmental Representative did not express any reservation to the averments made by the Learned Authorised Representative for the Assessee and submitted that the issue open for consideration for the Tribunal in the recalled matter stood covered by the decision of the Hon’ble Supreme Court in the case of Checkmate Services Private Ltd. v. CIT-1:[2022] 448 ITR 518 MA No. 647/Mum/2023 Assessment Year: 2018-19 3 (SC)[12-10-2022] in the favour of Revenue and therefore, the disallowance made by the Assessing Officer needs to be confirmed. 4. We have heard the rival submissions and perused the material on record. We find that while passing the order dated 26/09/2023, a mistake apparent on record that crept into order since the Tribunal had failed to take into consideration the order dated 23/09/20222, passed in ITA No. 1858/Mum/2022 and the order dated 11/08/2023, passed in MA No. 302/Mum/2023 [arising out of ITA No. 1858/Mum/2022]. On perusal of above orders, we find that only the issue for consideration before the Tribunal whether the Assessing Officer and CIT(A) were justified in rejecting the claim for deduction of INR 25,08,096/- in respect of Employees’ Contribution to Provident Fund (PF) and Employees’ State Insurance Corporation (ESCI) deposited after lapse of time prescribed in the applicable statute but before the due date of filing return specified under Section 139(1) of the Act. During the course of hearing, the Ld. Authorised Representative for the Assessee admitted that the issue stand covered against the Assessee and in favour of the Revenue by the judgment of Hon’ble Supreme Court in the case of Checkmate Services Private Ltd (supra). The disallowance of INR 25,08,096/- under Section 36(1)(vii) of the Act in respect of Employee’s Contribution to PF/ESI was to be confirmed. 5. In view of the above the order dated 26/09/2023 is hereby rectified. Paragraph 6 to 13 of the order dated 26/09/2023 shall stand substituted by the following paragraph 6 to 13: “6. Being aggrieved, the Assessee carried the issue in appeal before the Tribunal. Vide order, dated 23/09/2022, the MA No. 647/Mum/2023 Assessment Year: 2018-19 4 Tribunal disposed off the appeal as being partly allowed for statistical purposes and allowed Assessee’s claim for deduction for Employees Contribution to Provident Fund/Employee State Insurance Corporation aggregating to INR 25,08,096/- deposited after the due date prescribed in the applicable statue but before the due date of filing the return of income by placing reliance upon the decision of Hon’ble Bombay High Court in the case of CIT Vs. Ghatge Patil Transports Ltd. [2014] 368 ITR 749 (Bom). 7. Subsequently, the Revenue preferred a Miscellaneous Application [MA No. 302/Mum/2023] against the aforesaid order dated 23/09/2022, passed in ITA No. 1858/Mum/2022, the relevant extract of which read as under: “Issues raised in the miscellaneous application All the issues are in connection with the confirmation of the disallowance of Rs.25,08,096/- u/s 36(1) (va) of the Act. The contention of the assessee is that the Employee's Contribution of Rs.25,08,096/- was deposited before the due date of filing the return, therefore, the same amount is liable to be allowable u/s 36(1)(va) of the Act. The Hon'ble ITAT has referred Hon'ble Bombay High Court decision in the case of CIT Vs. M/s. Ghatge Patil Transports Ltd (2014)368 ITR 749 (Bom) and has allowed the appeal of assessee. The issue involved in the said case has now attained finality in the latest judgment of Hon'ble Supreme Court in the case of Checkmate Services P. Ltd Vs. Commissioner of Income Tax-1 (CIVIL APPEAL NO. 2833 of 2016 dt. 12.10.2022) in favor of Revenue regarding payment towards contribution to employees provident fund. 3. Therefore, Miscellaneous Application is submitted before Hon'ble ITAT 'H' Bench in above mentioned case to get the present appeals restored in view of the latest judgment of Hon'ble Supreme Court in the case of Checkmate Services P. MA No. 647/Mum/2023 Assessment Year: 2018-19 5 Ltd Vs. Commissioner of Income Tax-1 (CIVIL APPEAL NO. 2833 of 2016 dt. 12.10.2022). Hence this Miscellaneous Application is filed.” 8. Vide order dated 11/08/2023, passed in MA No 302/Mum/2023, the Tribunal recalled the order dated 23/09/2022 passed in ITA No. 1858/Mum/2022 for the limited purpose of the adjudication of the ground related to deduction for Employees’ Contribution towards Provident Fund/Employee State Insurance Corporation after the due date prescribed by the respective law. The relevant extract of the aforesaid order read as under: “2. The revenue submitted that Tribunal in ITA No. 1858/Mum/2022 for AY. 2018-19 has allowed the claim of the assessee with respect to deduction pertaining to amount deposited in the relevant fund towards Employee’s contribution to PF/ESIC beyond the due date for payment as specified in the PE/ESIC Act, but paid before the due date of filing return of income u/s 139(1) of the Act. And the Department has preferred this MA against the impugned action of Tribunal. At the outset, it is noted that the Department received the impugned order of Tribunal on 14.12.2022 as evident from the date stamp affixed on the copy of impugned order of this Tribunal, and since there is no other evidence to take a contrary view regarding date of receipt of impugned order, we note that Department has filed the miscellaneous application in this registry on 13.04.2023 which is within six (6) months of receipt of the impugned order of the Tribunal, so we admit the MA being filed within the limitation period, and for doing that, we rely on decision of Hon’ble Bombay High Court in the case of Daryapur Shetkari Sahakari Ginning and Pressing Factory v. ACIT [2021] 123 taxmann.com 301 (Bombay). Proceeding further, we note that MA has been preferred to recall the impugned order in the light of Hon’ble Supreme Court decision in the case of Checkmate Services Pvt. Ltd. Vs. CIT-1448 ITR 518 which has set at rest the controversy wherein it was held that employer/assessee’s have to deposit the employee’s contribution towards PF/ESIC on or before the due date prescribed in the respective law [PF/ESIC Acts] for availing the deduction u/s 36(1)(va) of the Act. Considering the MA No. 647/Mum/2023 Assessment Year: 2018-19 6 decision of Hon’ble Supreme Court as referred above, and the fact and issue involved in our impugned order, we recall the impugned order passed in the appeal and restore the appeal for fresh adjudication. 3. In the light of the above discussion, we direct the registry to fix the appeal for hearing on 14.09.2023. 4. In the result, Miscellaneous application filed by the revenue is allowed.” 9. On perusal of the order, dated 11/08/2023, passed by the Tribunal in MA No. 302/Mum/2023, we find that the only issue for consideration before the Tribunal is whether the Assessing Officer and CIT(A) were justified in rejecting claim for deduction of INR 25,08,096/- in respect of Employees’ Contribution to Provident Fund (PF) and Employees’ State Insurance Corporation (ESIC) deposited after lapse of time prescribed in the applicable statute but before the due date of filing return specified under Section 139(1) of the Act. 10. We have heard the rival contention and perused the material on record. 11. Admittedly, in the case of Checkmate Services Private Ltd. v. CIT-1:[2022] 448 ITR 518 (SC)[12-10-2022], this issue stands decided in favour of the Revenue wherein it was held by the Hon’ble Supreme Court 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 MA No. 647/Mum/2023 Assessment Year: 2018-19 7 of employees and held in trust by assessee-employer. Therefore, such assessee-employer would not be absolved 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. 12. Accordingly, in view of the above, the order of CIT(A) confirming disallowance of deduction of INR 25,08,096/- under Section 36(1)(va) of the Act is confirmed. 13. In terms of the aforesaid read with the order, dated 23/09/2022 passed by the Tribunal, the appeal preferred by the Assessee is partly allowed.” 6. In result, the present Miscellaneous Application preferred by the Assessee is allowed. Order pronounced on 08.03.2024. Sd/- Sd/- (Prashant Maharishi) Accountant Member (Rahul Chaudhary) Judicial Member म ुंबई Mumbai; दिन ुंक Dated : 08.03.2024 Alindra, PS MA No. 647/Mum/2023 Assessment Year: 2018-19 8 आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपील र्थी / The Assessee 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
