Trinity Tradex Pvt Ltd Vs ITO (ITAT Kolkata)
The assessee filed appeals against separate orders of the CIT(A) for Assessment Years 2020-21 and 2021-22. Since the issues involved in both appeals were identical, they were heard together and decided through a common order.
The first issue related to an addition of ₹9,41,558 made by the Assessing Officer on account of contingent liability. The assessee submitted that while filing the return of income along with the tax audit report, the tax auditor had mistakenly reported a Bank of Baroda bank guarantee amounting to ₹9,41,558 as a contingent liability. Based on this disclosure, CPC Bengaluru added the amount to the assessee’s income, even though it had not been claimed as an expense in the profit and loss account. The CIT(A) upheld the addition. The Tribunal found that the amount had been wrongly mentioned in the tax audit report and directed the Assessing Officer to delete the addition of ₹9,41,558.
The second issue concerned disallowance of ₹80,007 relating to delayed payment of employees’ provident fund contribution. The assessee contended that the delay occurred during the Covid period and that the contribution was deposited within the extended time limit. Relying on the EPFO notification dated 15.04.2020, the Tribunal directed deletion of the disallowance.
