2023 (8) TMI 762 - AT - Income Tax

Adjustment u/s 43B - intimation u/s 143(1) - non - payment of GST - sum erroneously mentioned by the auditor in form 3CD Report in Column No. 26(i)(B)(a) in as against column just to above column, as the same was paid on 26.06.2019 20.09.2019 - HELD THAT - As considering the documents which substantiates the fact that the assessee had deposited the aforesaid amount of GST before the due date of furnishing of his return of income for the year under consideration, therefore, he could not have been saddled with any disallowance u/s. 43B. Also we cannot remain oblivion of the fact that the revised audit report filed u/s. 44AB was not there before the lower authorities at the time of processing of the assessee s return of income u/s. 143(1) and has been filed before us as additional evidence. As the claim of the assessee that the amount of GST payable as was reflected as payable in the balance sheet on 31.03.2019, is shown to have been deposited prior to the due date of filing of his return of income as provided in sub-section (1) of Section 139 of the Act, i.e., on the strength of his affidavit and the copy of GST payable account for A.Y. 2019-20, therefore, the revised audit report dated 25.02.2023 that has been filed by the him as an additional evidence being merely supportive of the aforesaid factual position merits to be admitted. The matter in all fairness requires to be revisited by the A.O, who shall in the backdrop of the aforesaid documentary evidence filed by the assessee to fortify his claim, therein verify the authenticity of the same - if the amount of GST was deposited by him on or before the due date of furnishing of his return of income for A.Y. 2019-20, then, the disallowance made by the A.O u/s. 43B of the Act shall stand vacated. Appeal of the assessee is allowed for statistical purposes

Summary

Issues Involved:
1. Disallowance u/s. 43B made by AO CPC in intimation u/s 143(1) for non-payment of GST erroneously mentioned in the audit report.
2. Non-admission of additional evidence filed under rule 46A regarding payment of GST.

Issue 1: The controversy in the present appeal revolves around the sustainability of the disallowance of Rs. 80,289/- made by the Assessing Officer under section 43B of the Income-tax Act. The assessee had filed the appeal against the order passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Center (NFAC), Delhi, which arose from the intimation by the Centralized Processing Center (CPC)/A.O under Sec. 143(1) for the assessment year 2019-20. The disallowance was related to GST payment mentioned in the audit report but not paid by the due date of filing the return of income.

Issue 2: The second issue pertains to the non-admission of additional evidence filed under rule 46A regarding the payment of two challans of Rs. 44,530 and Rs. 37,000 towards GST, along with the certificate of the auditor and an affidavit confirming the payment. The assessee contended that the provisions of Sec 43B were not applicable as the GST amount was paid before the due date of filing the return of income.

The Judicial Member considered the facts and submissions from both parties. It was found that the auditor had mistakenly reported the GST payment in the wrong column in the audit report, leading to the disallowance by the AO. The revised audit report and supporting documents confirmed that the GST amount was indeed paid before the due date. The Judicial Member concluded that no disallowance under Sec 43B was warranted. The matter was directed to be revisited by the AO to verify the authenticity of the documentary evidence provided by the assessee. If the claim of timely GST payment is substantiated, the disallowance made by the AO under Sec 43B would be vacated. The appeal of the assessee was allowed for statistical purposes based on the observations made.