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TMI Blog2022 (9) TMI 1320X X X X Extracts X X X X X X X X Extracts X X X X ..... f law as the Faceless appeal scheme,2020 itself is bad in law being in violation of principle of natural justice and hence liable to be quashed. 4. On the facts and circumstances of the case, the order passed by NFAC is bad both in the eye of law as the Faceless appeal scheme,2020 under which this order has been passed itself is in violation of provisions of the Income Tax Act and Rules framed therein and hence liable to be quashed. 5. On the facts and circumstances of the case, the order passed by NFAC is bad in law having being passed in violation of the faceless appeals scheme and hence liable to be quashed. 6. On the facts and circumstances of the case, the order passed by NFAC is bad in law having being passed without giving opportunity of being heard physically. 7. On the facts and circumstances of the case, the order passed by NFAC is bad in law having being passed without giving opportunity of being heard through video conferencing. 8. On the facts and circumstances of the case, NFAC has erred both on fact and in law in confirming the action of the learned AO(CPC) making the disallowances by exercising its powers beyond the scope of section 143(1) of the Income Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w, that amendment to section 36(1)(va) of the Act, by way of insertion of Explanation-2 brought in by Finance Act, 2021; is retrospective in nature, and is applicable for AY 2019-20. (C) Aggrieved, the assessee has filed this present appeal in Income Tax Appellate Tribunal ("ITAT" for short) against the aforesaid impugned appellate order dated 15/12/2021 of the Ld. CIT(A). At the time of hearing before us, the Ld. Authorized Representative ("AR" for short) for the assessee submitted that the Ld. CIT(A) should have deleted the additions, instead of sustaining the aforesaid additions amounting to Rs.58,72,654/-. The Ld. Sr. DR relied upon the impugned appellate order dated 15/12/2022 of the Ld. CIT(A). (D) We have heard both sides. We have perused the materials on record. Relevant facts are not in dispute. It is not in dispute that employees' contribution to ESI/Provident Fund, totaling the aforesaid amount of Rs.58,72,654/- was deposited by the assessee after the specified date prescribed under laws providing ESI/Provident Fund; but these payments were deposited by the assessee well before due date of filing of return of Income Tax prescribed u/s 139(1) of Income Tax Act. The afor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; and TML Business Services Ltd. [2022] 93 ITR (Trib.) (S.N.) 35 (Mumbai) for Assessment Year 2017-18 (order dated 29th Dec., 2021). In the cases of Continental Restaurant and Café Co. vs. ITO (supra), Nikhil Mohine vs. DCIT (Supra), Shand Pipe Industry Pvt. Ltd. vs. DCIT (supra); Digiqal Solution Services Pvt. Ltd. vs. Assistant Director of Income Tax (supra) and Gopalakrishna v/s ADIT (supra), the different Benches of Income Tax Appellate Tribunal have, in fact, specifically considered the aforesaid amendments brought to Income Tax Act by Finance Act, 2021; and have taken the view that the amendments are prospective in nature, having no application for the period prior to 01/04/2021. Even if Revenue does not accept the view, that the aforesaid amendments are prospective in nature having no application for Assessment Years prior to Assessment Year 2021-22; it is clearly established in the light of aforesaid decisions of Income Tax Appellate Tribunal (ITAT); referred to in this paragraph earlier, that the issue whether the aforesaid amendments are prospective or retrospective, is at least debatable and controversial, on which a view in faour of the assessee (that the aforesa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (P.) Ltd. vs. ACIT, [2008] 305 ITR 0103 (Supreme Court). In this present case before us, the additions have been made by way of adjustments vide intimation u/s 143(1) of Income Tax Act, dated 08/02/2021. As on 08/02/2021, the orders of Hon'ble Delhi High Court in favour of assessee and against Revenue on this issue in aforesaid cases of CIT vs. AIMIL Ltd. (supra); and CIT vs. P.M. Electronics Ltd. (supra) were available. Accordingly, the aforesaid amount of Rs.58,72,654/- could not have been added to assessee's income as on 31/10/2019 in the light of these precedents of the Hon'ble Delhi Court in favour of the assessee. Therefore, we are of the view that the aforesaid adjustments made by Revenue on 31/10/2019, whereby the aforesaid amount of Rs.58,72,654/- was added to assessee's income, were unfair, unjust, and bad in law. For this view, we respectfully take support from the order of Agra Bench of ITAT, in the case of Mahadev Cold Storage vs. Jurisdictional Assessing Officer (supra). At the very least, Revenue should have given due consideration to the fact that the issue was highly debatable and controversial. As already discussed earlier, adjustments u/s 143(1) of Income Tax Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a debatable and controversial issue, and Ld. CIT(A) did err in law, in not deleting this addition. (E) In the light of the foregoing conclusions in paragraph (D.2.1) of this order, we are of the view that the aforesaid additions of Rs.58,72,654/- by way of adjustment and intimation u/s 143(1) of Income Tax Act, were beyond the scope of Section 143(1) of Income Tax Act; and further, that the Ld. CIT(A) erred in law in confirming the aforesaid addition on a debatable and controversial issue. Accordingly, we direct the Assessing Officer to delete the aforesaid addition of Rs.58,72,654/-. (E.1) By way of abundant caution, we hereby clarify that we have not expressed any view in this order, on whether the aforesaid amendments brought in by Finance Act, 2021 [whereby Explanation-2 was inserted in Section 36(1)(va) of Income Tax Act and Explanation-5 was inserted in Section 43B of Income Tax Act] are prospective or retrospective. In the light of our decision in foregoing paragraph (E) of this order; this issue is merely academic in nature; hence not decided. (F) The second and third issues in this appeal are contained in grounds 11 and 12 of the appeal. Ground 11 of appeal pertains t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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