RAJASTHAN EX SERVICE MEN WELFARE CORP SOCIETY LIMITED,SUKH NIWAS, BANI PARK, JAIPUR V. INCOME TAX OFFICER WARD 1(2), JAIPUR

ITA 1286/JPR/2024

AI Insights

The case involves the Rajasthan Ex-Service Men Welfare Corp. Society Ltd appealing against the orders of the lower tax authorities, which were ex-parte and allegedly deprived the assessee of a fair opportunity to contest the case. The primary issues revolved around the late deposit of Provident Fund (PF) and Employees' State Insurance (ESI) contributions, which were disallowed by the AO under section 36(1)(va) of the Income Tax Act. The tribunal noted the assessee's lack of response to multiple opportunities provided by the lower authorities but decided to restore the matter to ensure a decision on merits, highlighting the importance of the principle of natural justice.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 35438 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2022-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GAUTAM SINGH CHOUDHARY
• Assessee Lawyers: SURESH KUMAR GUPTA
• Keywords: Opportunity of being heard
• Section: 143(1)

Judgement Text

"vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR Mk0 ,l- lhrky{eh]U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA No. 1286/JP/2024 fu/kZkj.k o\"kZ@Assessment Years : 2022-23 Rajasthan Ex-Service Men Welfare Corp. Society Ltd D-225, Sukh Niwas, Bani Park, Jaipur cuke Vs. The ITO, Ward- 1(2) Jaipur LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAATR 9192 G vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Suresh Kumar Gupta, Advocate jktLo dh vksjls@Revenue by : Shri Gautam Singh Choudhary, JCIT-DR lquokbZ dh rkjh[k@Date of Hearing : 11/02/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement: 17/03/2025 vkns'k@ORDER PER: DR. S. SEETHALAKSHMI, J.M. This appeal filed by the assessee is directed against the order of the ld. Addl. CIT(A)-11, Delhi dated 25-08-2022 for the assessment year 2012-13 raising following the grounds of appeal. “1. That on law and facts the Ld. Add. CIT(A)-11, Delhi has grossly erred in rejecting appeal filed by appellant on dated 21.06.2023. The notice issued on dated 21.06.2024 was not received by assessee, and further in response to notice dated 06.08.2024, assessee move an application for adjournment for upto 31.08.2024 on dated 14.08.2024, but appeal order was passed on dated 27.08.2024. As such the action of Ld. Addl. CIT(A), Delhi was totally wrong and illegal, and against the principal of natural justice and deserves to be quashed. 2 ITA NO. 1286/JP/2024 RAJASTHAN EX-SERVICE MEN WELFARE CORP. SOCIETY LTD VS ITO, WARD 1(2), JAIPUR 2. That on law and facts the Ld. AO CPC has grossly erred in disallowing contribution of employees of provident fund and ESI of Rs. 2093886/- u/s. 36(1) (va) while during the assessment year 2022-23 only Rs. 751286/- was deposited late by two days to 14 days only. As such disallowances of Rs. 2093886/- u/s. 36(1)(va) is totally unjustified and as such order deserves to be quashed. 3. That share of employee PF of Rs. 751286/- were deposited late by 2 days to 14 days due to peak period of COVID-19, hence late deposit of above PF may please be condone due to above reason and addition of Rs. 751286/- u/s. 36(1) (va) may not be made in intimation issued u/s. 143(1). 4. That the Ld. AO CPC has grossly erred in processing return of income u/s. 143(1) of the Act without following the proceedings as laid down under said section. The action of the Ld. AO CPC is unjustified and against the facts of the case. Hence the intimation passed u/s. 143(1) deserves to be quashed. 5. That the order of the Ld. CPC is bad in law and deserves to be quashed. 2.1 It is noted from the order of the ld. Addl. CITA) that the appeal was transferred to him on 13-08-2023 under e-assessment scheme by NFAC and he dismissed the appeal of the assesssee treating it as an ex-parte order by observing as under:- ‘’3. The facts of the case as noted above are that the appellant has not pursued the appeal despite being granted several opportunities as elaborated supra. No details, documents or submission have been provided to come to any conclusion other than those arrived at by the assessing officer in the order. The notices have been duly served upon the assessee via e-mail. Regrettably no response whatsoever was forthcoming on the appointed date. Thus, nothing has been placed on record to substantiate as to why the addition made by the AO should not be sustained. 3 ITA NO. 1286/JP/2024 RAJASTHAN EX-SERVICE MEN WELFARE CORP. SOCIETY LTD VS ITO, WARD 1(2), JAIPUR 4. In view of the above, the undersigned is left with no option but to decide the case on the basis of material on record. Bare perusal of the facts shows that the appellant has not pursued the appeal despite being granted to several opportunities as elaborated supra. The grounds of appeal are therefore dismissed. Despite several notices being issued, the appellant has not made any compliance. The appeal is dismissed.’’ 2.2 At the outset of the hearing of the appeal, the ld. AR of the assessee submitted that the orders passed by the lower authorities are ex-parte orders and the assessee was deprived off to contest the case before the lower authorities. Thus the assessee may be given one more chance to contest the case before the AO so that the issue could be decided on merit. The ld. AR of the further submitted that he sent the letter to the Addl. CIT (A)-11, Delhi communicating therein his submission of the assessee. ‘’In connection with our appeal, we submit as under:- 1. That assessee filed return of income on dated 11-10-2022 and declared income of Rs. 584164. In intimation issued u/s 143(1) dated 7- 06-2023 addition of Rs.2093886/- were made by CPC due to late deposit of ESI and PF by the assessee. 2. We submit that details of ESI and PF receipt during the above assessment year were as under:- Particulars Employees Contribution Employer Contribution ESI 86416.00 385783.00 PF 3127516.00 6181214.00 4 ITA NO. 1286/JP/2024 RAJASTHAN EX-SERVICE MEN WELFARE CORP. SOCIETY LTD VS ITO, WARD 1(2), JAIPUR 3. We submit the complete details of deposit of ESI and PF of both side are enclosed alongwith reply. The details of deposits of ESI and PF late of both contributions are as under:- ESI late deposit Nil PF late deposit of both employer and employee contribution is Rs. 751286.00 As such since ESI of both sides were deposited in time, hence no addition is required u/s 43B. Further addition against late deposit of PF cannot be made more than Rs.751286/- in any circumstances, hence you are requested to please restrict the addition of Rs.7,51,286/- and balance Rs.13,41,600/- and oblige,’’ 2.3 On the other hand, the ld. DR supported the order of the ld. CIT(A) . 2.4 We have heard both the parties and perused the materials available on record. The Bench noticed that it is an admitted fact that the assessee is ex-parte before the AO and also before the ld. CIT(A). Therefore, he could not put forth his defence. It was the bounded duty of the assessee to appear before the statutory authorities as and when called for. It is noticed that various opportunities were provided to the assessee for settling the issue but the assessee remained lethargic and unserious in pursuing his case. However, we are of the view that lis between the parties has to be decided on merits so that nobody’s rights could be scuttled down without providing opportunity of being heard to the assessee. Hence, the matter is restored to the file of the AO to decide it afresh by providing one more opportunity of hearing, however, the assessee will not seek any adjournment on 5 ITA NO. 1286/JP/2024 RAJASTHAN EX-SERVICE MEN WELFARE CORP. SOCIETY LTD VS ITO, WARD 1(2), JAIPUR frivolous ground and remain cooperative during the course of proceedings. Thus the appeal of the assessee is allowed for statistical purposes. 2.5 Before parting, we may make it clear that our decision to restore the matter back to the file of the AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by AO independently in accordance with law. 3.0 In the result, the appeal of the assesee is allowed for statistical purposes Order pronounced in the open court on 17 /03/2025. Sd/- Sd/- ¼jkBksM deys'kt;UrHkkbZ ½ ¼MkWa-,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;dlnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 17/03/2025 *Mishra * vkns'k dh izfrfyfivxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Rajasthan Ex-Service Men Welfarer Corp. Society Ltd. Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward- 1 (2), Jaipur. 3. vk;djvk;qDr@ The ld CIT 4. foHkkxh; izfrfuf/k] vk;djvihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 5. xkMZQkbZy@ Guard File ITA No. 1286/JPR/2024) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asstt. Registrar "