SATYA PRAKASH AND BROS PVT. LTD.,DELHI V. DCIT - CIRCLE 22(2), DELHI, DELHI

ITA 2192/DEL/2024

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The case involves Satya Prakash and Bros Pvt. Ltd., the appellant, contesting an order from the Learned Addl./Joint Commissioner of Income Tax (Appeals)-1, Pune, which pertained to the assessment year 2018-19. The primary contention was regarding an addition of Rs.94,56,959 made by the Central Processing Centre (CPC), which alleged inconsistency in the revenue from operations declared by the assessee and as computed based on the return of income filed. The assessee argued that the CPC had mistakenly considered the gross receipts as contract revenue without accounting for deductions such as sales tax and other contractee deductions. The Tribunal found merit in the assessee's argument regarding the turnover discrepancy and remanded the issue back to the AO for verification. Additionally, the Tribunal upheld the disallowance related to delayed payments towards PF & ESI contributions, referencing the Supreme Court's decision in Checkmate Service Pvt. Ltd.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 669334 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-06-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2018-2019
• Other Referred Cases: Checkmate Service Pvt. Ltd. vs. reported in (2022) 143 taxmann.com 178
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NARPAT SINGH
• Assessee Lawyers: AMIT GOEL

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘G’ NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.2192/Del/2024 (ASSESSMENT YEAR: 2018-19) Satya Prakash and Bros Pvt. Ltd., A1 CC Colony, Opp. Rana Pratap Bagh, Delhi-110007 PAN:AAHCS1210Q Vs. DCIT, Circle-22(2), Delhi. (Appellant) (Respondent) O R D E R PER MANISH AGARWAL, AM: This appeal is filed by the assessee against the order of Learned Addl./Joint Commissioner of Income Tax (Appeals)-1, Pune (‘the CIT(A) in short), dated 28.02.2024 in Appeal No. CIT(A), Delhi-8/10918/2019-20 vide order dated 28.02.2024. 2. Ground of appeal No. 1 is general in nature and needs no adjudication. The ground of appeal No. 2 in relation to the additions / adjustment of Rs.94,56,959/- made by the CPC by observing that there is inconsistency in the total revenue from operations declared by the assessee and as computed on the basis of return of income filed. In this regard, the Ld. AR of the assessee drew our attention to the financial statements of the assessee which contained the Balance Sheet and Profit and Loss account for the year under appeal. According to which, the assessee has declared total revenue from operations at Rs.62,59,78,108/-. Ld. AR further submits that in Note No.19 to the Balance Sheet, the “Revenue from operations” was stated according to which Assessee by Shri Amit Goel, CA and Shri Pranav Yadav, Adv. Department by Shri Narpat Singh, Sr. DR Date of hearing 24.06.2025 Date of pronouncement 27.06.2025 2 IT No.1625/Del/2025 Anant Agarwal. vs. CIT(A) gross collected revenue was of Rs. 63,51,63,167/- and after reducing the amount towards sales tax of Rs.79,06,057/- and other deduction by contractees of Rs.12,79,002/-, net income revenue from operations was declared at Rs.62,59,78,108/-. However, the CPC has mistakenly consider the gross receipts as contract revenue, and therefore, he prayed that the addition made deserves to be deleted. On the alternate, is requested that the matter may be sent to the file of AO for necessary verification of the facts as stated above. 3. On the other hand, the Ld. Sr. DR supports the order of the lower authorities and requested for the confirmation of the same. 4. Heard both the parties. From the perusal of the Note No.19 to financial statements as filed by the ld. AR during the course of hearing, it is seen that the assessee has declared gross contract revenue at Rs.63,51,63,167/- which has been taken as gross turnover by the CPC. The assessee further claimed deduction towards the sales tax and other deductions made by contractees to arrive at the figure of the not contract receipts which is declared in the return of income filed. Form these facts it appears that there is no difference in the turnover declared by the assessee, however, in the interest of justice, as requested by the Ld. AR of the assessee, this issue is sent back to the file of the AO for making necessary verification of the claim of the assessee. The AO is further directed to make verification of the turnover of the assessee from the records maintained by the assessee and decide the issue in accordance with law. With these directions, grounds of appeal No. 2 is partly allowed for statistical purposes. 5. Ground of appeal No.3 of the assessee is with regard to the disallowance of Rs.2,71,900/- made by CPC u/s 36(1)(va) of the Act being delayed payment of employees contribution towards PF & ESI. This issue has already been covered against the assessee in view of the judgment of the Hon’ble Supreme Court in the case of Checkmate Service Pvt. Ltd. vs. reported in (2022) 143 taxmann.com 178. Thus, by respectfully following the judgment of Hon’ble 3 IT No.1625/Del/2025 Anant Agarwal. vs. CIT(A) Supreme Court in case of Checkmate Services (supra), we confirm the disallowance made by the CPC. Ground No.3 is dismissed. 5. In the result, the appeal of the assesse is partly allowed. Order pronounced on 27/06/2025. Sd/- Sd/- (ANUBHAV SHARMA) (MANISH AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 27.06.2025. PK/Sr. Ps Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi "