S. 43B : Deductions on actual payment-Adjustment u/s. 143(1)(iv)(a)-Disallowance under section 36(1)(va) of the Act- Assessing Officer could not make disallowance based on observations made in Tax audit report that payments were made after due date specified under respective Acts- Adjustment u/s 143(1)(iv)(a) of the Act is bad in law – Judgement of Supreme Court in Checkmate Services Pvt. Ltd. v. CIT (2022) 448 ITR 518 / 218 DTR 218 / 143 taxmann.com 178 (SC) was rendered in the context where the assessment was farmed under section 143(3) of the Act hence not applicable when the adjustment is made u/s. 143(1) of the Act. [S. 2(24), 36(1)(va), 139(1), 143(1), 143(i)(a)(v)]
ADIT-CPC Bangalore disallowed deduction claimed by assesee in respect of employee’s contribution towards PF by invoking section 143(1)(iv)(a) of the Act Disallowance was based on observations made by tax auditor in audit report which stated that payments of employee contribution were made by assessee after due date specified under respective acts .CIT(A) affirmed the order of the Assessing Officer . On appeal the Tribunal referred the decision of Mumbai Tribunal in Kalpesh Synthetics (P.) Ltd. v. Dy. CIT (2022) 195 ITD 142 / 96 ITR 690 (Mum.)(Trib.) and held that disallowance by invoking section 143(1)(iv)(a) of the Act is not valid. The Tribunal referred the judgement of Supreme Court in Checkmate Services Pvt. Ltd. v. CIT(2022) 448 ITR 518 / 218 DTR 218 /143 taxmann.com 178 (SC) and held that the said decision was rendered in the context where assessment was farmed under section 143(3) of the Act . Accordingly the appeal of the assessee was allowed. (ITA No. 2376/Mum/2022, dt. 7-12-2012) (AY. 2019-20)
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[Hon’ble Shri Aby T. Varkey, Judicial Member and Shri M. Balaganesh, Accountant Member]