TaxTMI 
TaxTMI 
2021 (9) TMI 363
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....nd on the facts and circumstances of the assessee's case in upholding a disallowance of Rs. 5,76,522/- on account of delayed deposit of Employees' Contribution to PF and ESI. 2. That the Order passed by the learned CIT(A) upholding the action of the Assessing Officer is bad in law. 3. That the learned CIT(A) failed to appreciate that the delay in such deposit was attributable to the technical reasons of delay in clearance of cheque although such cheques had been issued by the assessee on due dates as per the respective Acts of ESI and PF. 4. That each ground is independent of and without prejudice to the other grounds raised herein." (B) Both the grounds of appeal pertain to additions totaling Rs. 5,76,522/- ma....
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.... Aggrieved again, the Assessee has filed the present appeal in Income Tax Appellate Tribunal ("ITAT", for short). In the course of the Appellate Proceedings in ITAT, the following documents were filed from the assessee's side: Copy of Employee Provident Fund Organisation Challans Copy of judgement of Repco Home Finance Ltd. (2014-TIOL-2044-HCMAD- IT Copy of judgemnt of Ogale Glass Works Ltd. (2002-TIOL-631-SC-IT-LB) Copy of judgement of Crescent Roadways Private Limited [TS-510-ITAT- 2021 (HYD)] Synopsis dated 27th August, 2021. (D) At the time of hearing before us, the Ld. Authorized Representative ("Ld. AR", for short) for the assessee once again submitted that the cheques were deposited in ....
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.... High Court in the context of interest under section 234C of I.T. Act. However, the ratio of the order of Hon'ble Madras High Court is applicable to the issue before us as well. The Hon'ble Madras High Court held in this case that even if the cheques were taken conditionally, the cheques not having been dishonoured but having been cashed, the payment related back to the dates of the receipt of the cheques and in law the dates of payments were the dates of the delivery of the cheques. The Hon'ble High Court further held that once the cheque issued by the assessee is encashed, the payment relates back to the date of receipt of the cheque. The following portion of the order of Hon'ble Madras High Court in the case of Commissioner of Income Tax....
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....l on the substantial question of law, referred supra. 3. We have heard Mr. T.R. Senthil Kumar, learned Standing Counsel for the Revenue and perused the orders passed by the Tribunal and the authorities below. 4. The core issue to be considered in this case is whether interest under Section 234C of the Act is to be calculated based on date of clearing of the cheque or date of presentation of the cheque. "5. The issue raised in this appeal is no longer res integra in view of the decision of the Supreme Court in Commissioner of Income Tax v. Ogale Glass Works Ltd., [1954] 25 ITR 529 = 2002-TIOL-631-SC-IT-LB, wherein it is held as under: "11. ..... When it is said that a payment by negotiable instrument is a ....
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....o opposite: 'Apart from the express terms of Section 33 sub-section 1, a similar conclusion might be founded on the well-known common law rules as to the effect of the sending of a cheque in payment of a debt, and in the fact that though the payment is subject to the condition subsequent that the cheque must be met on presentation, the date of payment, if the cheque is duly met, is the date when the cheque was posted.' In the case before us none of the cheques has been dishonoured on presentation and payment cannot, therefore, be said to have been defeated by the happening of the condition subsequent, namely, dishonour by non-payment and that being so there can be no question, therefore, that the assessee did not r....