The amendments by the Finance Act, 2021 on dues can't be applied retroactively, upholding the dismissal of Revenue's appeal due to low tax effect.

Order

PER BENCH :

All the above appeals filed by the Revenue arising out of the separate orders passed by CIT(A)/NFAC Delhi as per the details given below:

2. None appeared on behalf of the assessee nor any adjournment application was filed. Considering the matter, it was decided to hear the Ld. DR and decide based on material available on record.

3. Since the issues involved are common and the appeals were heard together, so these are being disposed off by this consolidated order for the sake of convenience and brevity.

4. The case of the Revenue in ITA No. 446/Chd/2023 pertaining to A.Y. 2018- 19 is taken as lead case wherein Revenue has raised the following grounds of appeal:

1. Whether on the facts & in the circumstances of the case, the CIT(A) was right in law in holding that the amendment which has been brought in by the Finance Act, 2021 shall apply w.e.f. assessment year 2021-22 and subsequent assessment years.

2. Whether on the facts & in the circumstances of the case, the CIT(A) has fallen into error while no noticing that Finance Act, 2021 also inserted a second Explanation to section 36(l)(va) wherein it was clarified that provisions of section 43B shall be deemed to never have been applied for the purposes of determining the "due date" under section 36(l)(va)

3. Whether on the facts & in the circumstances of the case, the CIT(A) was right in law in deleting the addition made by way of adjustment while processing the return of income u/s 143(1) of the Act so made by the CPC towards the deposit of employees' contribution towards ESI and PF, paid after the due date under relevant Act but before the due date of filing of the return of income u/s 139(1) of the Act.

4. Whether on the facts & in the circumstances of the case, the order of CIT(A)is legally unsustainable now that the Hon'ble Supreme Court vide its judgment in the case of Checkmate Services Pvt. Ltd., vs CIT, Civil Appeal No. 2383 of 2016 has brought finality to the issue of 'due date' as per the explanation to section 36(l)(va) vis-a-vis that in the second provision to section 43B.

5. The appellant craves leave to add, amend or delete any of the grounds of appeal during the appellate proceedings.

5. During the course of hearing, the Ld. DR submitted that the return of income declaring income of Rs. 22,37,300/- was e-filed by the assessee on 25/10/2018. The CPC processed the return u/s 143 (1) of the Act vide order dated 21/05/2019 by making an addition of Rs. 2,78,600/- on account of disallowance of ESI/PF which was deposited late i.e., after the due date and added it to the income of the assessee, thus, raising a demand of Rs.1,04,140/- (including interest). Aggrieved with order of the CPC, the assessee filed an appeal before the Id. CIT(A).

5.1 The Id. CIT(A), vide its order dated 13/09/2022 passed in appeal No.NFAC/2017-18/10153731 allowed the appeal. The Id. CIT(A) held that the amendment which has been brought in by the Finance Act, 2021 shall apply we.f. assessment year 2021-22 and subsequent assessment years and the impugned assessment year being assessment year 2018-19, the said amendment cannot be applied in the instant case. The Id. CIT(A) further directed that the addition made by way of adjustment while processing the return of income us 143(1) of the Act s