Appeals by Assessee as well as Revenue are not Maintainable unless Liquidator amend Form 36A during

The Mumbai bench of Income Tax Appellate Tribunal ( ITAT ) has held that appeals by the assessee as well as revenue are not maintainable unless liquidator amend form 36A during winding up proceedings.

The assessee, Osian’s Connoisseurs of Arts Pvt. Ltd., preferred an appeal against the order of the Principal Commissioner of Income Tax (PCIT), setting aside the order of assessing officer and reopening the assessment under section 263 of the Income Tax Act.

During appellate proceedings, the counsel for the revenue submitted that one of the lenders of the assessee company referred the matter to the National Company Law Tribunal under the Insolvency and Bankruptcy Code. The application of the creditor has been accepted and the interim resolution professional has also been appointed.

The Tribunal observed that once an interim resolution professional has been appointed by the NCLT, then the earlier counsel authorized by the management of the company has no authority to represent the case and therefore adjournment sought on his behalf was accordingly rejected.

The Tribunal by relying on theTribunal’s own decision in the case of Orbit Corporation Limited, further observed that once the winding up proceedings are initiated against the assessee, the appeals by the assessee as well as the revenue are not maintainable in the present format as the liquidator had not come up before the Tribunal to file the amended Form No. 36A in case the assessee as well as revenue,s appeal.

The Coram of Mr. Kuldip Singh, JM and Mr. Om Prakash Kant, AM has held that “we find that in the instant case also the Form 36A has not been amended. Therefore, this appeal is not maintainable in the present format”.

Penalty u/s 271 alone will Not Exist after Deletion of Addition on Income: ITAT

The Cuttack Bench of Income Tax Appellate Tribunal has held that penalty u/s 271 alone will not exist after deletion of addition on Income.

During the course of assessment proceedings against the appellant, the PrajatantraPrachar Samity, the Assessing officer made addition on income and impose penalty u/s 271. Aggrieved by the addition and imposing penalty assessee preferred appeal before ITAT. On appeal ITAT deleted the addition. Later the AO demanded the penalty under sec 271. Aggrieved by the order assessee preferred appeal before CIT (A), which confirmed the imposition of penalty.

Aggrieved, assessee appealed before the ITAT against the order CIT (A) imposing penalty. The counsel for the appellant submitted that the additions in the quantum assessment have been deleted by the Co-ordinate Bench of Cuttack Tribunal. The appellant further submitted that the quantum additions itself have been deleted by the Tribunal, the penalty u/s 271 is liable to be cancelled.

The Tribunal observed that the Co-ordinate Bench of this Tribunal has already deleted the additions made in the quantum assessments on the basis of which penalty has been levied u/s.271(1)(c) of the Act for all the three assessment years.

The Coram of Mr. George Mathan, Judicial Member and Mr. Arun Khodpia, Accountant Member has held that “we are of the view that the penalty has no more legs to stand. Consequently, we cancelthe penalty levied u/s.271(1)(c) of the Act by the AO and confirmed by the

CIT (A) for the impugned assessment years.

Belated Payment of Employee Contribution to PF/ESI Deposited before due date for filing Return

The Allahabad Bench of Income Tax Appellate Tribunal ( ITAT ), has held that the belated payment of employee contribution to PF/ESI deposited before the due date for filing the return of income is deductible u/s 43B.

The appellant, M/s. SBW Udyog Limited filed its return of income u/s. declaring a total income of Rs. 15,48,69,400/-.An additional amount of Rs.6,24,281/- was added to the income of the assessee on the grounds that the assessee has not deposited the employee share of PF/ESI collected/deducted by the assessee from the salaries of employees, to the credit of said employees maintained with relevant fund concerning PF/ESI within the time prescribed under the relevant statute concerning PF/ESI. The filed first appellate authority dismissed the appeal, the aggrieved assessee filed an appeal before ITAT.

The counsel for the appellant submitted that the employee share of PF/ESI which is collected by employer is to be allowed as deduction u/s 36(1)(va) of the 1961Act despite the same is deposited to the credit of employee with relevant fund concerning PF/ESI beyond the due date prescribed for depositing the said amount under the relevant statute concerning PF/ESI, provided the same is deposited before the due date of filing of return of income u/s 139(1) of the 1961 Act.

The counsel for the appellate further submitted that the Finance Act, 2021 made amendment in provision of Section 36(1)(va) and 43B of the 1961 Act, but the Memorandum to Finance Bill, 2021 clearly stipulates that said amendments are applicable from AY 2021-22 and onwards and hence the same is to be prospectively applied.

The Tribunal observed that the Jurisdictional High Court in the case of Sagun Foundry Private Limited has held that deduction is to be allowed for belated payment of employee contribution to PF/ESI which is deposited beyond the due date stipulated under the relevant statutes governing PF/ESI, but the same stood deposited before the due date for filing of return of income as is prescribed u/s 139(1) of the 1961 Act.

The bench presided by Mr. Vijay Pal Rao, Judicial Member, and Mr. RamitKochar, Accountant Memberwhile allowing the appeal, has held that “we are directing AO to verify the challans evidencing the deposit of aforesaid employee share of PF/ESI and that it was deposited before the due date prescribed for filing of return of income u/s 139(1), before allowing the claim of deduction u/s 36(1)(va) of the 1961 Act”.