IN THE INCOME TAX APPELLATE TRIBUNAL “DB” BENCH: PATNA VIRTUAL HEARING AT KOLKATA (cid:302)ी राजेश कुमार, लेखा सटèय एवं (cid:302)ी (cid:292)द(cid:547)प कुमार चौबे, Ûया(cid:467)यक सदèय के सम¢

[Before Shri Rajesh Kumar, Accountant Member& Shri Pradip Kumar Choubey, Judicial Member]

Assessment Year: 2018-19 Prashant Packaging Pvt. Ltd. Vs. DCIT/ACIT, Circle-2, Patna (PAN: AABCP 4957 D)

Appellant / (अपीलाथ(cid:568)) Respondent / (cid:292)×यथ(cid:568)

Date of Hearing / सुनवाई 27.03.2025 क(cid:551) (cid:467)त(cid:876)थ Date of Pronouncement/ 21.04.2025 आदेश उ(cid:622)घोषणा क(cid:551) (cid:467)त(cid:876)थ For the assessee / Shri A. K Rastogi, Sr. Advocate (cid:467)नधा(cid:91)(cid:464)रती क(cid:551) ओर से

For the revenue / राजèव Sh. Ashwani Kr. Singal, JCIT क(cid:551) ओर से

ORDER / आदेश Per Pradip Kumar Choubey, JM:

This is the appeal preferred by the assessee against the order of Commissioner of Income Tax (Appeal)-NFAC, Delhi (hereinafter referred to as the Ld. CIT(A)] dated

24.10.2024 for AY 2018-19.

2. Brief facts of the case of the assessee are that the assessee being a company filed its return of income for AY 2018-19 declaring total income of Rs. 84,55,050/-. The case of the assessee was selected for limited scrutiny on the issue of payment of bonus or commission to the employee and assessment order u/s 143(3) of the Act was passed by AO making disallowance u/s 40A(3) amounting to Rs. 5,15,169/- on account of cash bonus paid to the employees.

3. Aggrieved by the said order, the assessee preferred an appeal before the Ld.

CIT(A) wherein also the appeal of the assessee has been dismissed.

Being aggrieved and dissatisfied the assessee preferred an appeal before us.

4. The Ld. Counsel challenges the very impugned order thereby submitting that the Ld. CIT(A) has confirmed the disallowance relying upon the provision of Section 40A(3) of the Act by holding that there has been sufficient time for the assessee to make bonus payment before Deepavali Festival through banking channel or any working date ignoring the reality that the bonus is a statutory liability and without disputing the genuineness and identity of the recipients i.e. the employees. The Ld. Counsel cited following decisions:

i) Decision of Hon’ble Calcutta High Court in the case of Girdharilal Goenka vs. CIT

179 ITR 122 (Cal)

ii) CIT vs. CPL Tannery in 318 ITR page 179 iii) Gurdas Garg vs. CIT(A) & Ors. [2016] 6 ITR OL 101 (P & H)

iv) Honey Enterprises vs. CIT [2016] 381 ITR 258 (Del)

v) Union of India vs. Exide Industries Ltd. [2020] 425 ITR 1 vi) Decision of Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. vs.

CIT in [2022] 448 ITR 518 (SC)

The Ld. Counsel draws the attention to the Tribunal over the judgment of Checkmate Services Pvt. Ltd. (supra) regarding the Payment of Bonus Act, 1965 and submitted that provision of section 43B have overriding effect over any other provision of general application and thus the deduction on account of payment of bonus shall be allowed on the basis of actual payment within statutory time limit under the relevant Statute i.e.

Payment of Bonus Act.

5. Contrary to that the Ld. D.R supports the impugned order.

6. We have heard the Counsel of the respective parties. The only issue is for adjudication is that the payment made by cash. The Ld. CIT(A) has clearly held in this order is that total bonus payment of Rs. 5,45,443/- during FY 2017-18, bonus payment of Rs. 5,15,169/- have been paid to various employees in cash. On going over the order passed by the AO one thing is not in dispute that payees are not the new to the assessee and they are the employees of the assessee to whom salary payments are being made. So, identity of the payees and payment of bonus to them was not in dispute. The Hon’ble Calcutta High Court in the case of Girdharilal Goenka vs. CIT (supra) as cited by the assessee has held thus:

“The Income-tax Officer has to take a pragmatic view of the matter. The Income-tax Officer should take a practical approach to problems and stri