2022 (4) TMI 633 - AT - Income Tax

Delayed deposit of employees contribution to ESI/PF - Addition u/s 36(1)(va) read with section 2(24)(x) - Deposits before the due date of filing of return u/s 139( 1) - HELD THAT - As relying on case of LUMINO INDUSTRIES LTD. 2021 (11) TMI 926 - ITAT KOLKATA we direct the AO to allow the claim of deduction in respect of employees contribution shares towards ESI, PF, by the assessee before the due date of filing of return u/s 139( 1) of the Act. Therefore the appeal of assessee succeeds and so, it is allowed in favor of assessee.

Summary

Issues:
- Disallowance of employees' contribution to ESI/PF
- Condonation of delay in filing appeal
- Violation of natural justice in assessment order
- Debatable issue in assessment order
- Dismissal of appeal without proper opportunity of hearing
- Request for additional evidences
- Request to press new, additional grounds of appeal

Analysis:
1. Disallowance of employees' contribution to ESI/PF:
The appeal was filed against the disallowance of ?1,21,216 for delayed deposit of employees' contribution to ESI/PF. The appellant contended that the disallowance was unjustified and should be reversed. The issue was the main focus of the case, and the Tribunal proceeded to address it first. The appellant argued that the issue was covered in their favor by a judgment of the High Court and a recent order of the Tribunal. The Departmental Representative did not contest the facts but supported the disallowance. The Tribunal found in favor of the appellant, citing legislative amendments and judicial precedents, and deleted the disallowance.

2. Condonation of delay in filing appeal:
The appeal was initially time-barred by 10 days, and a Condonation of Delay (COD) was filed. After considering the contents and hearing the parties, the Tribunal condoned the delay and admitted the appeal for disposal on merits.

3. Violation of natural justice in assessment order:
The appellant argued that the assessment order violated the principles of natural justice, leading to the entire proceeding being unlawful. However, this issue was not specifically addressed in the detailed analysis provided in the judgment.

4. Debatable issue in assessment order:
The appellant claimed that the assessment order was based on a highly debatable issue, making it unlawful. The Tribunal did not provide a detailed analysis of this issue in the judgment.

5. Dismissal of appeal without proper opportunity of hearing:
The appellant contended that the appeal was dismissed on merits without adequate hearing opportunities. The Tribunal did not address this issue specifically in the detailed analysis provided in the judgment.

6. Request for additional evidences:
The appellant sought permission to produce additional evidences under Rule 29 of the Income Tax (Appellate Tribunal) Rules 1963. However, the judgment did not elaborate on whether this request was granted or not.

7. Request to press new, additional grounds of appeal:
The appellant also requested permission to press new, additional grounds of appeal or modify existing grounds during the hearing. The judgment did not provide details on whether this request was addressed or not.

In conclusion, the Tribunal allowed the appeal regarding the disallowance of employees' contribution to ESI/PF, citing legislative amendments and judicial precedents in favor of the appellant. The issues of condonation of delay, violation of natural justice, debatable issue in assessment order, dismissal of appeal without proper hearing, and requests for additional evidences and new grounds of appeal were not extensively discussed in the detailed analysis provided in the judgment.