TaxTMI 
TaxTMI 
2024 (10) TMI 299
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....e u/s 143(1) and confirmed by the ld. AO in the assessment order passed u/s 143(3) r.w.s. 143(3A) and 143(3B). As there was ambiguity of late payment of ESIC/PF, the same falls out of purview of section 143(1). 4. The appellant craves leave to add, to alter, amend, modify, sub statute, delete and or rescind all or any of the grounds of appeal on or before final hearing, if necessity so arises. 3. Ground Nos. 1 & 2 are regarding disallowance made u/s 36(1)(va) of the Income-tax Act, 1961, on account of belated payment for Employees' contribution to P. F. and ESIC. 4. We have heard the Ld. Authorized Representative of the assessee as well as Ld. Departmental Representative and have perused the relevant material on record. This issue of addition made on account of belated payment of employees' contribution to P. F. and ESIC is now covered by the decision of Hon'ble Supreme Court in the case of Checkmate Services P. Ltd. vs. CIT-I, 448 ITR 518, and the relevant part of the decision in paras 51 to 55 are as under :- "51. The analysis of the various judgments cited on behalf of the assessee i.e.,CIT v. Aimil Ltd. [2010] 188 Taxman 265/321 ITR 508 (Delhi); CIT ....
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.... income; at the time, payment with in the prescribed time - by way of contribution of the employees' share to their credit with the relevant fund is to be treated as deduction (Section 36(1)(va)). The other important feature is that this distinction between the employers' contribution (Section 36(1)(iv)) and employees' contribution required to be deposited by the employer (Section 36(1)(va)) was maintained - and continues to be maintained. On the other hand, section 43B covers all deductions that are permissible as expenditures, or out-goings forming part of the assessees' liability. These include liabilities such as tax liability, cess duties etc. or interest liability having regard to the terms of the contract. Thus, timely payment of these alone entitle an assessee to the benefit of deduction from the total income. The essential objective of section 43B is to ensure that if assessees are following the mercantile method of accounting, nevertheless, the deduction of such liabilities, based only on book entries, would not be given. To pass muster, actual payments were a necessary pre-condition for allowing the expenditure. 53. The distinction between an emp....
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....t is upon deposit, in terms of those enactments and on or before the due dates mandated by such concerned law, that the amount which is otherwise retained, and deemed an income, is treated as a deduction. Thus, it is an essential condition for the deduction that such amounts are deposited on or before the due date. If such interpretation were to be adopted, the non-obstante clause under section 43B or anything contained in that provision would not absolve the assessee from its liability to deposit the employee's contribution on or before the due date as a condition for deduction. 55. In the light of the above reasoning, this court is of the opinion that there is no infirmity in the approach of the impugned judgment. The decisions of the other High Courts, holding to the contrary, do not lay down the correct law. For these reasons, this court does not find any reason to interfere with the impugned judgment. The appeals are accordingly dismissed." Accordingly, following the judgement of Hon'ble Supreme Court Ground Nos. 1 & 2 of the assessee's appeal stand dismissed. 5. Ground No. 3 is regarding jurisdiction of CPC while processing the return of income u/s 143(....
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....2018 03.05.2018 9. EPF(July 2017) Rs. 88,428/- 15.08.2017 25.09.2017 10. EPF(Aug 2017) Rs. 94,013/- 15.08.2017 25.09.2017 11. EPF(Oct 2017) Rs. 1,04,870/- 15.11.2018 18.11.2017 12. EPF(March 2017) Rs. 1,30,756/- 16.04.2018 07.05.2018 Total Rs. 27,91,386/- However, the above payments have been duly made before the due date of filing the return, and hence, the provisions of section 43B of the IT Act, 1961 are not applicable in its case. 3. The assessee firm filed request for retification with the CPC against the said intimation on 02.12.2019 'but the same was rejected on 12.12.2019 vide DIN CPC/1819/T13/1918529294 'Stating that the rectification request could not be considered at the CPC and the rectification rights transferred to Assessing Officer. Now, since the case is under scrutiny, the assessee has requested for deleting the disallowance m....
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....ued u/s 143(1) of the Act. Therefore, this issue is very much subject matter of the assessment framed u/s 143(3) of the Act and hence, no issue arises qua the jurisdiction of CPC while processing the return of income u/s 143(1) for making such adjustment, when the case of the assessee was taken up for complete scrutiny and the assessment was framed u/s 143(3) read with sections 143(3A) and 143(3B) of the Income-tax Act, 1961. Even otherwise once scrutiny assessment was completed subsequent to processing of return u/s 143(1), the order of CPC merges with the assessment order passed u/s 143(3) and only in case when the assessment order is quashed being invalid or void ab initio, the order of CPC u/s 143(1) would revive and assessee would be at liberty to take the remedial steps under the law. Therefore, we do not find any merit or substance in the ground no. 3. The same is dismissed. 7. The assessee has also raised an objection against the validity of the assessment order on the ground that the AO has not issued a draft order mandatory as per the e-Assessment Scheme, 2019. The Ld. Authorized Representative of the assessee has submitted that the assessment order was passed by the A....
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....before passing final assessment order. He has further submitted that the Ld. CIT(A) has dismissed this ground of appeal as the assessee did not press the same and, therefore, the assessee cannot agitate this issue before the Tribunal. 9. We have considered the rival submissions as well as relevant material placed on record. There is no dispute that as per the e-Assessment Scheme, 2019, notified by the CBDT by Notification dated 1st November, 2019, the scrutiny is undertaken by National e-Assessment Centre by issuing a notice u/s 143(2) of the Act specifying the issues of selection of the case for scrutiny assessment. After receiving the response from the assessee to the notice u/s 143(2), the case shall be assigned by the National e-Assessment Centre to specific assessment unit in any one regional e-Assessment Centre through an automatic allocation system. Thus, under the e-Assessment Scheme, no direct correspondence is done between the assessment Unit or the regional assessment Centre and the assessee, but all the correspondences are made through National e-Assessment Centre. Therefore, all the notices issued are routed through the National e- Assessment Centre and all reply fr....
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....he assessee is seeking quashing of the assessment order being invalid on the strength of judgement of Hon'ble Mumbai High Court in the case of Chander Arjan Das vs. NFAC and Others, (supra). However, it is pertinent to note that the said decision of Hon'ble Bombay High Court has been set- aside by the Hon'ble Supreme Court reported in 293 Taxman 296 (S.C.) in the case of National Faceless Assessment Centre vs. Mantra Industries Limited in para 2 to 7, as under :- "2. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court of Judicature at Bombay in Chander Arjandas Manwani v. National Faceless Assessment Centre [2021] 130 taxmann.com 445/283 Taxman 380/[2022] 442 ITR 197, by which the High Court has allowed the said writ petition and has quashed the Assessment Order, the Revenue has preferred the present appeal. 3. From the impugned judgment and order passed by the High Court, it appears that while quashing and setting aside the Assessment Order, the High Court has heavily relied upon the CBDT Circular dated 13-8-2020 issued under section 119 of the Income-tax Act, 1961 (for short "the Act"), more particularly, ....