Income Tax Appellate Tribunal - Delhi
Chetan Bhandari, New Delhi vs Itd, Cpc, Bengaluru on 19 May, 2022
IN THE INCOME TAX APPELLATE TRIBUNAL,
DELHI BENCH 'G', NEW DELHI
BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND
SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER
Sr. ITA No(s) Asst. Appeal(s) by Assessee By Revenue By
Nos Year(s) Appellant vs. Respondent
Appellant Respondent
1. 324/Del/2022 2019-20 Manifold E-Connect ITO, --None-- Shri Sanjay
Limited, New Delhi Kumar Nargas,
EF-R/8, 3rd Floor, Sr. DR
Inderpuri,
New Delhi - 110012.
PAN : AABCV7718C
2. 342/Del/2022 2018-19 Ankit Aggarwal, ACIT, --None-- --do--
503, FIE, Patparganj, Central
Delhi-110092. Circle-18,
PAN-ADQPA8599K Delhi
3. 343/Del/2022 2019-20 --do-- --do-- --None-- --do--
4. 351/Del/2022 2018-19 Om Innovation Call CIT(A), Shri Anil --do--
Services Pvt.Ltd., Circle-19(1), Chopra, CA
C-7, Community NFAC, Delhi
Centre, Janak Puri,
Delhi-110058.
PAN-AAACO7862P
5. 352/Del/2022 2019-20 --do-- --do-- --do-- --do--
6. 532/Del/2022 2019-20 Deepali Design & AO, Central Shri Amit, AR --do--
Exhibits Pvt.Ltd., Circle-17,
GN-06, Shivaji Delhi
Enclave, Rajouri
Garden,
New Delhi-110027
PAN : AABCD5680K
7. 652/Del/2022 2018-19 Rakesh Kumar Gupta, AO, Shri Suresh --do--
C-111, ANtriksh Ward-38(3), K.Gupta, CA
Apartment, Sector-14, Delhi
Rohini,
New Delhi- 110085.
PAN-AAKPG4091R
8. 654/Del/2022 2018-19 Acclaim Industries, ADIT, --do-- --do--
405, Savera Circle-36(1),
Apartments, Sector- Delhi
13, Rohini,
New Delhi-110085.
PAN-AAVFA8829L
9. 728/Del/2022 2019-20 Fabcare Garments & CPC -None- --do--
Textile machinery Bangalore
Pvt.Ltd, 81-A, GH-10,
Sundar Apartment,
Outer Ring Road,
Paschim Vihar,
New Delhi-110087.
PAN : AAACF7934R
10. 735/Del/2022 2018-19 S.S.R.Retail, ADIT, CPC Shri Yashu --do--
Shop No.21, Sarojini Bengaluru Goel, CA
Nagar Market,
New Delhi-110023.
2
PAN : ABYFS1420R
11. 736/Del/2022 2018-19 Stelatoes Shoes & DCIT, CPC Shri Madhava --do--
Accessories Pvt.Ltd., Bengaluru Kapoor, Adv.
A-42, Gate no.1,
Mayapuri Industrial
Area, Phase-2,
New Delhi-110064.
PAN : AAMCS4060R
12. 737/Del/2022 2018-19 Jaguar Security CPC --do-- --do--
Services Pvt.Ltd., Banglore
C/o-B.K.Kapur & Co.,
Chartered
Accountants, 17
Navyug Market,
Ghaziabad, Uttar
Pradesh-201001.
PAN : AAACJ3711E
13. 738/Del/2022 2018-19 M.N. Automobile CIT(A), --do-- --do--
Pvt.Ltd., NFAC, New
C/o-B.K.Kapur & Co., Delhi
CAs, 17 Navyug
Market, Ghaziabad,
Uttar Pradesh-201001.
PAN : AABCS8165N
14. 754/Del/2022 2019-20 Canary Agro CIT(A), Shri Ajay --do--
Chemicals Pvt.Ltd., Circle-5(2), Kumar
7, Shopping Centre, Delhi Aggarwal, AR.
Karampura,
New Delhi-110015.
PAN : AAACD0498C
15. 770/Del/2022 2018-19 Brij Polymers Pvt.Ltd., DCIT, CPC, Shri Yashu --do--
A-62, Saraswati Vihar, Bengaluru Goel, Adv.
Pitampura,
Delhi-110034.
PAN : AAACB3029K
16. 771/Del/2022 2019-20 --do-- ACIT, CPC, --do-- --do--
Bengaluru
17. 772/Del/2022 2018-19 B.S. Enterprises, DCIT, CPC, --do-- --do--
B-273, Mangolpuri Bengaluru
Industrial Area,
Delhi-110083.
PAN : AAGFB9940G
18. 773/Del/2022 2017-18 VE Commercial DCIT, CPC, Ms. Manisha --do--
Vehicles Ltd., Bengaluru Sharma, Adv.
3rd Floor, Select City
Walk, A-3, District
Centre, Saket,
New Delhi-110017.
PAN-AABCE9378F
19. 768/Del/2022 2018-19 --do-- ADIT, CPC, --do-- --do--
Bengaluru
20. 780/Del/2022 2019-20 A.K.Automatics, DCIT, CPC, --None-- --do--
Hissar Road, Rohtak, Bangalore
Haryana-124001.
PAN-AABFA4065A
21. 818/Del/2022 2018-19 TRIO Security & AO, --None-- --do--
Intelligence Pvt.Ltd., Ward-25(4),
I-36, Lajpat Nagar-IST, Delhi
New Delhi-110024.
PAN : AAACT5352R
3
22. 819/Del/2022 2018-19 --do-- AO, --None-- --do--
Ward-25(4),
Delhi
23. 837/Del/2022 2018-19 Gaurav International, ADIT, Shri K V S R --do--
B-34, Mayapuri CPC, Krishna, CA
Industrial Area, Bangalore
Phase-I, Delhi-110064.
PAN : AAAFG5920D
24. 847/Del/2022 2019-20 Kamal Dixit, CIT(A), --None-- --do--
240, VPO-Bhainsra NFAC, Delhi
Wali, Ballabgarh,
Faridabad,
Haryana-121004.
PAN-ASTPD3725G
25. 853/Del/2022 2019-20 Saroj Gautam, CIT(A), Shri --do--
House No.326/G.F., Gurgaon R.K.Gour, CA
Sector-9A, Gurgaon,
Haryana-122001.
PAN : AHYPG2373B
26. 850/Del/2022 2019-20 RIshi Prakash, CIT(A), Shri --do--
C/o-Umang Sahai Rohtak U.S.Aggarwal,
Aggarwal, Adv., 505, Adv.
Maitri Apartment,
Opp. Metro Pillar 411,
Sector-9, Rohini,
Delhi-110085.
PAN-ADZPS3716M
27. 858/Del/2022 2019-20 Supple Tek Foods, DCIT, Karnal Shri Nimish --do--
M/s Supple Tek Nagpal, CA
Foods, Kurak Road,
Taraori Nilokheri,
Karnal, Haryana-
132117.
PAN : ACFFS6407G
28. 1290/Del/2021 2019-20 Chetan Bhandari, ITD, CPC, Shri Bishnu Shri H.K.
4/20, W E A, Bengaluru Bhaswan Chaudhary,
Karol Bagh, Gupta, Adv. CIT DR
New Delhi-110005.
PAN : AADPB3548H
29. 1457/Del/2021 2018-19 Krishan Pal Sharma, DCIT, --do-- --do--
F-1601, GPL Eden CPC,
Heights Tower-F, New Delhi
Darbar Pur Road, Sec-
70, Near Badshah Pur,
Gurgaon-122001.
PAN : ADLPS4970R
30. 10/Del/2022 2018-19 Trans Metalite India DCIT, CPC, Shri Bishnu --do--
Ltd., 4417/7, Ansari Bangalore Khandelwal,
Road, Daryaganj, Adv.
Delhi-110002.
PAN-AAACT0351N
31. 11/Del/2022 2019-20 --do-- --do-- --do-- --do--
32. 31/Del/2022 2018-19 Universal Engineering CIT(A), --None-- Shri Sanjay
Corporation, Sabri Mill New Delhi Nargas, Sr.DR
Compound, Ambala
Road, Saharanpur,
U.P.-247001.
PAN-AAAFU2219D
33. 66/Del/2022 2018-19 Ahluwalia Contracts ACIT, Shri Vishal Shri H.K.
India Ltd., A-177, CC-31, Shekhar, CA Chaudhary,
4
Okhla Industrial Area, New Delhi. CIT DR
Phase-I, Delhi-110020.
PAN-AABCA4304K
34. 70/Del/2022 2017-18 Shri Naresh Chandila, CPC, --None-- Shri Sanjay
H.No.1375/1, Julahan Bengaluru/ Nargas, Sr.DR
Basti Nangal Raya, ITO, Ward-
Delhi-110016. 49(4), Delhi
PAN-AIOPC1991N
35. 71/Del/2022 2019-20 Javi Systems India ADIT, --None-- --do--
Pvt.Ltd., H.No.AI/45, CPC,
Sushant Lok-2, Bangalore
Sector-55, Gurgaon,
Haryana-122011.
PAN-AABCJ7817L
36. 72/Del/2022 2018-19 Overdrive Electronics DCIT, Shri M.K. Shri H.K.
Pvt.Ltd., C-121, CPC, Aggarwal, AR Chaudhary,
Hosiery Complex, Bengaluru CIT DR
Phase-2, Gautam
Budh Nagar,
U.P-201305.
PAN-AAECM3076D
37. 86/Del/2022 2018-19 Kunstocom India Ltd., DCIT, --None-- Shri Sanjay
B-27, Defence Colony, Circle-13(1), Nargas, Sr.DR
Delhi-110024. Delhi.
PAN-AAACK0356L
38. 95/Del/2022 2018-19 Cosmos Industries CIT Appeal, --None-- --do--
Ltd., 202, Thapar NFAC, Delhi
Arcade, 47, Kalu Sarai
Hauz Khas, New Delhi-
110016.
PAN-AAACC6682R
39. 107/Del/2022 2019-20 Virtuous India Asst.DIT, Ms. Ananya Shri H.K.
Pvt.Ltd., O-92, Bank CPC, Kapoor, Adv. Chaudhary,
Street, Munirika, Bengaluru & Shri CIT DR
South West Delhi, Amarbir
Delhi-110067. Singh, Adv.
PAN-AADCV2741D
40. 128/Del/2022 2018-19 Kaizen Metel Forming CPC, --None-- Shri Sanjay
Pvt.Ltd., 40, Kirti Bengaluru Nargas, Sr.DR
Nagar, Delhi-110015.
PAN-AACCK1286B
41. 172/Del/2022 2019-20 Sunil Kumar, CIT(A), Shri Manoj Shri H.K.
F-39, 1st Floor, Raheja NFAC, Delhi Garg, CA Chaudhary,
Square, Sector-2, Imt CIT DR
Manesar, Gurgaon,
Haryana-122001.
PAN-AMYPK5336R
42. 234/Del/2022 2015-16 Global Canesugar DCIT, --None-- Shri Sanjay
Services Pvt.Ltd., TDI Circle-10(1), Nargas, Sr.DR
Centre, Plot No.7, Delhi
Jasola, Delhi.
PAN-AAFCG2309A
43. 235/Del/2022 2018-19 Indigo Infra Projects CIT(A), Shri Tarun Shri H.K.
Pvt.Ltd., WZ-13, D-2, Delhi Kandari, CA Chaudhary,
1st Floor, Opposite A-2, & Ms. Renu CIT DR
Gurudwara Asaltpur, Suri, CA
Janakpuri,
Delhi-110058.
PAN-AACCI8551P
44. 241/Del/2022 2018-19 Cosmos Systems, C- DCIT, --None-- Shri Sanjay
5
128/2, Mohamadpur CPC, Nargas, Sr.DR
Bhikajicama Place, Bangalore
Delhi-110066.
PAN-AAJFC3954E
45. 248/Del/2022 2019-20 Professional Catering DCIT, --None-- --do--
Service P.Ltd., CPC,
3925 28 203, Padam Bangalore
Chambers, Padam
Singh Road, Karol
Bagh, Delhi-110005
PAN-AAACP7697P
46. 250/Del/2022 2017-18 Superior Manpower CPC, Ms. Ananya Shri H.K.
Services Pvt.Ltd., Bengaluru Kapoor, Adv. Chaudhary,
DSM 609-610, 6th & Shri CIT DR
Floor, DLF Towers, Amarbir
Shivaji Marg, Singh, Adv.
Najafgarh, Moti Nagar,
Delhi-110015
PAN-AAJCS6616E
47. 251/Del/2022 2019-20 --do-- --do-- --do-- --do--
48. 256/Del/2022 2018-19 Everest Beverages & DCIT, --None-- Shri Sanjay
Food Industries, D-21, CPC Nargas, Sr.DR
Industrial Estate,
Partapur, Meerut,
U.P.-250002.
PAN-AAAFE2833M
49. 307/Del/2022 2018-19 Krishan, ADIT, --None-- --do--
K K Plaza, 3rd Floor, CPC,
Sheila Bye Pass Bangalore
Sonipat Road, Rohtak,
Haryana-124001.
PAN-APSPK5145H
50. 308/Del/2022 2019-20 Ind Sanitation ADCT, --None-- --do--
Solutions Pvt.Ltd., CPC,
43/44, Second Floor, Bangalore
Maa Gayatri Complex,
Rohtak,
Haryana-124001.
PAN-AAECI2759K
51. 312/Del/2022 2018-19 Rohde & Schwarz DCIT, Shri Vishal --do--
India Pvt.Ltd., CPC, Kalra, Adv. &
A-27, 1st Floor, Mohan Bangalore Shri Ankit
Corporative Industrial Sahni, Adv.
Estate, Mohan
Corporative, Mathura
Road, New Delhi-
110044.
PAN-AAACR3267P
52. 320/Del/2022 2018-19 Harjit Singh Boparai, ACIT, CPC, Shri Sumit --do--
C Flat No.736, Bangaluru Lalchandani,
Sector-29, Noida, Adv. & Shri
Gautam Budh Nagar, Abhinav
Uttar Pradesh-201301. Gaur, Adv.
PAN-AEZPB8775L
Date of hearing: 19.05.2022
Date of Pronouncement: 19.05.2022
6
ORDER
PER BENCH :
The present appeals are filed by the above mentioned assessees feeling aggrieved by the orders passed by appellate authority for various assessment years mentioned hereinabove.
2. Since the issue in all the appeals is common and is related to disallowance of employee's contribution of PF/ESI on account of delay in deposits as per the respective Acts. Therefore, we clubbed all of them together for the sake of brevity and convenience and disposing the same by way of this consolidated order. However, we are taking ITA No.324/Del/2022 [Assessment Year -2019-20] as a lead case wherein the assessee has raised the following grounds:
1. "That the Ld. CIT(A) has not afforded a proper opportunity of being heard in so far as the relying on certain judgments not confronted to the assessee before rejecting the contentions in the Written Submissions filed, thereby violating the principles of natural justice.
2. That the Intimation order by CPC u/s 143(1) dated 28/07/2020 is bad in law on the facts of the case and that Ld. Commissioner of Income Tax (Appeals) has erred in sustaining the addition made in the Intimation.7
3. That the CIT(A) has grossly erred in sustaining the addition of Rs. 6,75,861/- made in the Intimation order by CPC, u/s 143(1), of the ESI/PF of Employees Contribution paid before the due date of filing the return of income.
That the addition so made in the Intimation needs to be deleted.
4. That the Ld. CIT(A) has erred in not appreciating that the CPC has no power to make such adjustment u/s 143(1) when no such disallowance has been reported by the Tax Auditor in Clause 20(b) of the Form 3CD. Hence the illegal disallowance made by CPC of Rs.6,75,861/- needs to be deleted.
5. That the assessee craves indulgence to add, amend, alter, modify or take additional grounds of appeal."
3. Similar grounds with different amounts and assessment years have been raised in other appeals but however, the sum & substance and the issues involved in all the appeals are identical.
4. Before us, at the outset, Learned AR submitted that the sole grievance of the assessee is confirming the additions on account of delay in deposit of employee's contribution towards provident fund and ESI fund.
5. Before us, Learned AR submitted that additions have been made in the intimation issued by CPC, Bangalore u/s 36(1)(va) of the Income Tax Act, 1961 ("the Act") for the reason that the 8 contribution received towards PF/ESIC by the assessee from its employees was not deposited before the due date. He submitted that though there has been delay in deposit of PF/ESIC Contributions but all the contributions received by the assessee from its employees, have been deposited with the appropriate authorities before the filing of return of income by the assessee. He therefore, submitted that since the amounts have been deposited before the filing of return of income, no disallowance is called for and for aforesaid proposition, he relied on the decision of Azamgarh Steel & Power vs. CPC in ITA No.1626/Del/2020 dated 31.05.2021 and CIT vs. AIMIL Ltd. [2010] 188 Taxman 265 (Delhi) and various other decisions.
6. Learned DR on the other hand supported the order of lower authorities and also placed reliance on the decision of Delhi Tribunal in the case of Vedvan Consultants Pvt. Ltd. vs DCIT in ITA No.1312/Del/2020 order dated 26.08.2021. He also submitted that the amendment brought out by Finance Act 2021 would be applicable to the present case as by the amendment, it has been clarified that provisions of Section 43B of the Act shall not apply and shall be deemed never to have been applied to a sum 9 received by the assessee from any of his employees to which the provisions of sub clause (x) of Clause (24) of Section 2 applies.
7. We have heard the rival submissions and perused the material available on record. The issue is no more res-integra. The issue has already been settled in favour of the assessee by various judicial pronouncements by the Tribunal. The Hon'ble Jurisdictional High Court of Delhi in the case of PCIT vs Pro Interactive Service (India) Pvt.Ltd. in ITA No.983/2018 [Del.] order dated 10.09.2018 held as under:-
"In view of the judgement of the Division Bench of Delhi High Court in Commissioner of Income Tax versus AIMIL Limited, (2010) 321 ITR 508 (Del.) the issue is covered against the Revenue and, therefore, no substantial question of law arises for consideration in this appeal.
The legislative intent was/is to ensure that the amount paid is allowed as an expenditure only when payment is actually made. We do not think that the legislative intent and objective is to treat belated payment of Employee's Provident Fund (EPD) and Employee's State Insurance Scheme (ESI) as deemed income of the employer under section 2(23)(x) of the Act."
8. As far as reliance by Ld. DR on the amendment brought out by Finance Act, 2021 is concerned, "notes on clauses" to the 10 Finance Bill 2021 clearly states that the amendment will take effect from 01st April 2021 and will prospectively apply in relation to the assessment year 2021-22 and subsequent assessment year. In such a situation, we are of the view that the amendment brought out by Finance Act, 2021 does not apply to the assessment year under consideration.
9. Before us, the Revenue has not placed any material on record to demonstrate that the aforesaid order cited hereinabove has been overruled/stayed/set aside by higher judicial forum. In view of the aforesaid facts, we are of the view that the AO was not justified in denying the deduction claimed by the assessee on account of late deposit of PF/ESI/EPF, albeit before filing the return of income. Admittedly, in all the above-stated matters, the Revenue had not contended that the assessee has deposited the contribution after the filing of the return of income.
10. Apropos to ITA No.754/Del/2022 concerning Assessment Year 2019-20 in the case of Canary Agro Chemicals Pvt.Ltd., appearing at Serial No.14 captioned above, it was pointed out that the belated payment of employee's contribution towards PF & ESI in the proceedings having regard to the respective Acts, have already been disallowed by the assessee while computing the taxable income and thus such disallowance again made on account 11 of delay by the Revenue has resulted in double disallowance. It was further contended that this submission is without prejudice to the legal position enunciated by the Hon'ble High Court in the case of PCIT vs Pro Interactive Service (India) Pvt.Ltd. (supra).
11. We have proceeded to conclude the issue of allowability of expenses attributable to employee provident fund and employee state insurance scheme on the assurance that the employee's contributions towards PF & ESI have been deposited before the due date of filing of return of income. However, the Revenue shall be at liberty to seek restoration of the appeal where it is found as a matter of fact that the assessee has failed to deposit the employee's contribution before the due date of filing of return of income stipulated u/s 139(1) of the Act in accordance with law. In view of the above and respectfully following the decision of the Hon'ble Jurisdictional High Court of Delhi cited hereinabove, we allow the appeals filed by the captioned assessees.
12. In the result, all captioned appeals of the respective assessees are allowed.
Order pronounced in the open court on 19.05.2022.
Sd/- Sd/-
(PRADIP KUMAR KEDIA) (KUL BHARAT)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Date:-19.05.2022*Amit Kumar*
12
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR
ITAT NEW DELHI