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Facts
The assessee appealed against an order related to assessment year 2020-21, involving proceedings under Section 154 of the Income-tax Act. The appeal concerned the disallowance of ESI/EPF contribution amounting to Rs. 15,57,375/-.
Held
The tribunal noted a landmark Supreme Court decision in Checkmate Services Pvt Ltd Vs. CIT which settled the issue in favor of the department, stating that ESI/EPF contributions must be deposited before the due date of the corresponding statute. The aspect of actual salary disbursement was not adjudicated by lower authorities.
Key Issues
Whether the assessee's ESI/EPF contribution was deposited within the prescribed time frame as per the statute and Supreme Court's ruling, and whether the disallowance by lower authorities was justified.
Sections Cited
154, 139(1)
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Income Tax Appellate Tribunal, DELHI BENCH: “SMC” NEW DELHI
Before: SHRI SATBEER SINGH GODARA
Date of hearing 03.06.2025 Date of pronouncement 03.06.2025 ORDER This assessee’s appeal for assessment year 2020-21, arises against the Commissioner of Income Tax (Appeals)/Addl./JCIT(A)- 7, Mumbai’s DIN and order no. ITBA/APL/S/250/2024- 25/1073806311(1), dated 28.02.2025 involving proceedings under section 154 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.
Coming to the assessee’s first and foremost argument seeking to reverse both the learned lower authorities’ action disallowing its ESI/EPF contribution of Rs. 15,57,375/-, it is noticed that the hon’ble apex court’s recent landmark decision in Checkmate Services Pvt Ltd Vs. CIT [2022] 143 taxmann.com 278 (SC) has already settled the issue in the department’s favour that the same ought to be deposited on or before the due date in the corresponding statute than that of filing of section 139(1) return. The assessee fails in it’s instant first and foremost ground in very terms.
Next comes equally important aspect of assessee’s compliance to the foregoing statutory provision going by the actual date of salary disbursement, which has not been adjudicated by both the learned authorities. I thus deem it appropriate in the larger interest of justice to restore the assessee’s instant grievance to this limited extent to the learned Assessing Officer for his afresh appropriate factual verification subject to a rider that the assessee shall itself plead and prove at his own risk and responsibility that it had complied with the foregoing provision, going by the actual date of monthly salary disbursement in consequential proceedings. Ordered accordingly.
This assessee’s appeal is partly allowed for statistical purposes.
2 | P a g e Order pronounced in the open court on 3rd June, 2025