SAHEBRAO DAMU SHEWALE,NASHIK vs. DEPUTY COMMISSIONER OF INCOME TAX,CPC, BANGALORE

O R D E R

PER DR. DIPAK P. RIPOTE, AM:

2. The appellant contends that ld.CIT(A) erred in law and in facts in confirming addition amounting to Sahebrao Damu Shewale Rs.67,94,757/- made u/s 143(1) of ITA, 1961 on the basis of disclosure in tax audit report and thereby erred in not appreciating that such disallowance is beyond the scope of provisions of s.143(1) of ITA, 1961. 3. Appellant craves leave to add/alter/delete/ modify, all/any of the above grounds of appeal.”

Quote, “That, however, cannot apply in the case of amounts which are held in trust, as it is in the case of employees’ contributions- which are deducted from their income. They are not part of the assessee employer’s income, nor are they heads of deduction per se in the form of statutory pay out. They are others’ income, monies, only deemed to be income, with the object of ensuring that they are paid within the due date specified in the particular law. They have to be deposited in terms of such welfare enactments. It is upon deposit, in terms of those enactments and on or before the due dates mandated by such concerned law, that the amount which is otherwise retained, and deemed an income, is treated as a deduction. Thus, it is an essential condition for the deduction that such amounts are deposited on or before the due date.” Unquote.

Sahebrao Damu Shewale 3.1 This Tribunal of ITAT, Pune Bench in the case of Trimurti Cement Products Pvt. Ltd. v. ITO in dated 20/04/2023 has also upheld the disallowance made by the AO on account of delayed payment of employees’ contribution to PF & ESI.