Deputy Commissioner of Income Tax, Circle 22(1), Mumbai, Mumbai V. Quick Builders, Mumbai

MA 74/MUM/2023

AI Insights

The case involves the Deputy Commissioner of Income Tax-22(1) as the appellant and M/s Quick Builders as the respondent. The dispute centered on the deduction claims made by M/s Quick Builders for employee contributions to PF/ESIC, which were allegedly deposited beyond the due dates prescribed by the respective laws but before the due date for filing the income tax return. Initially, the ITAT allowed the deduction based on precedents that were later overturned by a Supreme Court decision, which clarified that such contributions must be deposited within the statutory due dates to qualify for deductions. Following this Supreme Court decision, the ITAT recalled its earlier order and directed the assessing officer to re-evaluate the case in light of the new legal precedent.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130176 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-04-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 30-03-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 22-01-2023
• Other Referred Cases: Checkmate Services Pvt. Ltd. Vs. CIT-1, Veritas Infratech P. Ltd., Ghatge Patil Transport Ltd., CIT Vs. Hindustan Organics Chemical Ltd., Elysees India P. Ltd. Vs. DCIT, circle -7
• Laws Referred To: EPF/ESIC Act, Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

P a g e | 1 ITA No.301/Mum/2022 MA 74/Mum/2023 DY.CIT-22(1) Vs. M/s Quick Builders IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA No. 301/Mum/2022 M.A. No. 74/Mum/2023 (A.Y.2018-19) Dy. Commissioner of Income Tax-22(1) Room No. 518, Piramal Chambers, Parel, Mumbai – 400012 Vs. M/s Quick Builders Plot No. 142, 3 rd Floor, Shah House, S.V. Road, Khar West, Mumbai - 400052 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AAAFQ0227F Appellant .. Respondent Appellant by : Gyaneshwar Kataram Respondent by : Richa Gulati Date of Hearing 31.03.2023 Date of Pronouncement 27.04.2023 आदेश / O R D E R Per Amarjit Singh (AM): Vide miscellaneous application no. 74/Mum/2023 the revenue seek to recall the order of the ITAT vide ITA No. 301/Mum/2022 dated 23.05.2022 for assessment year 2018-19. 2. The revenue submitted that Tribunal vide ITA No. 301/Mum/2022 has allowed the claim of the assessee with respect to deduction pertaining to amount deposited 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 after following the decision of coordinate bench in the case of Veritas Infratech P. Ltd. i.e ITA No. 2456 & 2457/Mum/2021 for A.Y. 2018-18 and 2019-20. In this regard, it is submitted that Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. Vs. CIT-1 P a g e | 2 ITA No.301/Mum/2022 MA 74/Mum/2023 DY.CIT-22(1) Vs. M/s Quick Builders Civil appeal no. 2833 of 2016 dated 12.10.2022 held that if the employer’s did not deposit the amount towards employee’s contribution on or before the due date as prescribed in the EPF/ESIC the assessee was not entitled to the deduction. The Hon’ble Supreme Court vide the decision referred as supra set at rest the entire controversy wherein it is held that employer’s have to deposit the employee’s contribution towards PF/ESIC on or before the due date prescribed in the respective law for availing the deduction. Considering the decision of Hon’ble Supreme Court as referred above, we recall the impugned order of the Tribunal and the same is adjudicated as follows: ITA No.301/Mum/2022 3. The fact in brief is that the A.O made adjustment while processing the return of income u/s 143(1). The CPC Banglore found that assessee has not deposited the employee’s contribution towards PF/ESIC to the amount of Rs.1,26,230/- to the government account within the due date as prescribed in PF/ESIC Act. Therefore, the CPC has disallowed amount of Rs.1,26,230/- on account of late deposit of employees contribution towards PF/ESIC u/s 36(1)(va) r.w.s 2(24)(x) of the Act to the government account beyond the due date as prescribed in the PF/ESIC Act. 4. The assesse filed the appeal before the ld. CIT(A). The ld. CIT(A) had also dismissed the appeal of the assessee. The assessee also referred the decision of Hon’ble jurisdictional High Court in the case of Ghatge Patil Transport Ltd. (2015) 53 taxmann.com 141 (Bom) and the decision in the case of CIT Vs. Hindustan Organics Chemical Ltd. (2014) 48 taxmann.com 421 (Bom) and various other decision of other High Court’s and Tribunals. 5. Even during the course of appellate proceedings before us the asssessee has referred the decision of ITAT Jaipur in the case of Paris P a g e | 3 ITA No.301/Mum/2022 MA 74/Mum/2023 DY.CIT-22(1) Vs. M/s Quick Builders Elysees India P. Ltd. Vs. DCIT, circle -7 dated 20.02.2023 for AY. 2018- 19. However, we consider that the cases referred by the assesse are of no help in view of the judgment of the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. Vs. CIT-1 Civil appeal no. 2833 of 2016 dated 12.10.2022 wherein held that it is essential condition for allowing the impugned deduction that such amounts are deposited within the due date as prescribed in the specified Act. If the employer did not deposit the amount towards employee’s contribution on or before the due date as prescribed under the EPF/ESIC Act the assesse was not entitled to the deduction. We consider that vide the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. Vs. CIT-1 Civil appeal no. 2833 of 2016 dated 12.10.2022 the entire controversy set at rest wherein it is held that employer’s have to deposit the employee’s contribution towards EPF/ESIC on or before the due date for availing deductions. Therefore, following the decision of Hon’ble Supreme Court as supra we restore this issue to the file of the assessing officer for deciding afresh in accordance with the decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. Vs. CIT-1 Civil appeal no. 2833 of 2016 dated 12.10.2022, therefore, appeal filed by the assessee is treated as allowed for statistical purposes. 6. In the result, the miscellaneous application filed by the revenue is allowed and the appeal of the assesse is treated as allowed for statistical purposes. Order pronounced in the open court on 27.04.2023 Sd/- Sd/- (Amit Shukla) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 27.04.2023 Rohit: PS P a g e | 4 ITA No.301/Mum/2022 MA 74/Mum/2023 DY.CIT-22(1) Vs. M/s Quick Builders आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीिीय अतिकरण/ ITAT, Bench, Mumbai.