This document provides a detailed analysis of the Income Tax Appellate Tribunal’s final decision on the case between DCIT, Circle-4(2), New Delhi and Concentrix Daksh Services India Pvt. Ltd., New Delhi, concerning the assessment year 2020-21. The case number is ITA 2582/DEL/2022, presided over by Hon’ble President Shri G.S. Pannu and Judicial Member Shri Saktijit Dey.
The appeal filed by the Revenue challenged the order dated 22.08.2022, passed by the National Faceless Appeal Centre (NFAC), Delhi. The case was filed on 2022-10-21, and the final order was pronounced on 2023-05-29. The primary issue in this case was the disallowance related to the delayed payment of employees’ contributions to Provident Fund (PF) and Employees State Insurance (ESI) amounting to Rs.16,50,700/-.
During the hearing on 18.05.2023, the Revenue was represented by Sr. Pramod Kumar, Sr. DR, and the respondent, Concentrix Daksh Services India Pvt. Ltd., was represented by Ms. Vidhi, CA, and Sh. Rishabh Jain, CA. The respondent submitted that they have accepted the addition of Rs.16,50,700/- in light of the Hon’ble Supreme Court judgment in the case of Checkmate Services (P) Ltd. Vs. CIT (2022) 448 ITR 518 (SC), and have deposited the tax amounting to Rs.5,98,620/-.
The Revenue’s appeal was based on the deletion of disallowance made on account of delayed payments of employees’ contributions to PF and ESI by the assessee, Concentrix Daksh Services India Pvt. Ltd. The amount in dispute was Rs.16,50,700/-.
The Tribunal noted that the respondent had accepted the addition and deposited the tax on the disputed amount. A letter dated 15.05.2023, along with a challan evidencing the payment, was furnished by the respondent’s representatives before the Bench.
The Tribunal took into account the Supreme Court judgment in the case of Checkmate Services (P) Ltd. Vs. CIT, which was pivotal in the respondent’s decision to accept the addition and pay the tax.
The Tribunal concluded that since the respondent had accepted the addition and discharged the tax liability, the dispute between the parties had been resolved, rendering the appeal infructuous. The order stated:
Order pronounced in the open court on 29th May, 2023.
(G.S. PANNU)
PRESIDENT
(SAKTIJIT DEY)
JUDICIAL MEMBER
This case underscores the importance of compliance with judicial precedents and the timely settlement of tax liabilities by the assessees. The dismissal of the appeal highlights that once the tax liability is accepted and paid by the assessee, further disputes on the matter become redundant.
The appellant, DCIT, Circle-4(2), New Delhi, challenged the order passed by the NFAC, Delhi, concerning the delayed payment of employees’ contributions to PF and ESI by the respondent, Concentrix Daksh Services India Pvt. Ltd., New Delhi. The disputed amount was Rs.16,50,700/-, with a tax effect of Rs.5,98,620/-.
The Revenue argued that the delayed payment of employees’ contributions to PF and ESI should be disallowed and added back to the income of the assessee. The respondent, Concentrix Daksh Services India Pvt. Ltd., accepted the addition and paid the tax as per the Supreme Court judgment in Checkmate Services (P) Ltd. Vs. CIT.
The Tribunal observed that the respondent had voluntarily accepted the addition and discharged the tax liability, resolving the dispute. This compliance rendered the appeal by the Revenue unnecessary and infructuous.
The Tribunal’s decision in the case of DCIT, Circle-4(2), New Delhi vs Concentrix Daksh Services India Pvt. Ltd., New Delhi, reaffirms the significance of judicial compliance and the resolution of tax disputes through timely acceptance and payment of tax liabilities by the assessees. The dismissal of the appeal demonstrates the efficiency of the judicial process in resolving tax disputes once the liabilities are settled.
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