2023 (6) TMI 1450 - AT - Income Tax

Addition being delayed deposit of employees contribution to P.F. u/s. 36(1)(va) - assessee contributing/depositing the same before the due date of filing of return of income u/s. 139(1) - HELD THAT - We note from the facts on record that the disallowance has been made on the basis of Tax Audit Report in Form 3CD dated 28.09.2019 e-filed by the assessee on 01.10.2019 wherein in clause 20(b) of Form 3CD the details of payment made towards employees contribution for PF are reported with due date and the date of actual payment indicating thereby the delay if any. Counsel has claimed that there are mistakes in the reporting of actual payment date by the Tax Auditor and therefore needs verification. For this a prayer has been made for remitting the matter back to the file of Ld. AO. We find it proper to accept the submission and remit the matter back to the file of Ld. AO for verification of actual payment dates with the challans for deposit of the impugned contribution respect of which disallowance has been made. Ld. AO may verify the same and consider the allowance in accordance with the provisions of law as well as taking into consideration the decision of Chekmate Services Pvt. Ltd. 2022 (10) TMI 617 - SUPREME COURT Accordingly ground taken by the assessee in this respect is allowed for statistical purposes.

Summary

Issues:
Appeal against disallowance of delayed deposit of employees' contribution to P.F. u/s. 36(1)(va) of the Income Tax Act, 1961.

Analysis:
The appellant, engaged in tea cultivation, filed its return of income for AY 2019-20, reporting business income. The Centralised Processing Centre (CPC) disallowed an amount relating to delayed payment of employees' Provident Fund contribution. The appellant appealed to the Ld. CIT(A), who upheld the disallowance. The appellant then approached the Tribunal challenging the order.

The appellant's counsel argued that discrepancies in dates reported in the Tax Audit Report led to the disallowance. He requested a remand to the Ld. AO to verify the challans for the deposit of the contribution. The counsel cited the recent decision of the Hon'ble Supreme Court in Chekmate Services Pvt. Ltd. vs. CIT [2022] 143 taxmann.com 178 (SC) to support the appeal. The Senior DR did not object to this submission.

The disallowance was based on the Tax Audit Report filed by the appellant, indicating the due dates and actual payment dates of the Provident Fund contributions. The appellant claimed errors in the reporting of actual payment dates by the Tax Auditor, necessitating verification. The Tribunal accepted this claim and remitted the matter back to the Ld. AO for verification of the actual payment dates with the challans. The Ld. AO was directed to consider the allowance in accordance with the law and the Supreme Court's decision in Chekmate Services Pvt. Ltd.

Consequently, the Tribunal allowed the appellant's appeal for statistical purposes, indicating a favorable outcome for the appellant in challenging the disallowance. The order was pronounced in open court on 9th June 2023.