M.D.D. MEDICLA SYSTEMS(INDIA) PVT. LTD.,DELHI vs. DCIT, CIRCLE-16(1), DELHI

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ITA 9144/DEL/2025Status: DisposedITAT Delhi15 July 2026AY 2018-195 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The tribunal allowed the ground related to EPF disallowance, directing the AO to verify the payment dates in light of the Supreme Court's decision. For the Section 43B issue, the tribunal found the disallowance unsustainable as the expenditure was not claimed in the profit and loss account.

What were the facts?

The assessee appealed against an order disallowing delayed deposit of EPF contributions and an addition for inconsistency in disallowance under Section 43B. The EPF issue involved a disallowance of Rs. 3,73,242, and the Section 43B issue involved an addition of Rs. 3,93,106.

What were the issues?

Whether delayed deposit of EPF contributions is disallowable, and whether disallowance under Section 43B is sustainable when the expenditure is not claimed in the profit and loss account.

Which sections of the Income-tax Act were involved?

Section 143(1)(a),Section 154,Section 43B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, DELHI

Before: SHRI M BALAGANESH & SHRI ANUBHAV SHARMA

For Appellant: CA Sh. Samyak Jain, Adv
Hearing: 29.04.2026Pronounced: 15.07.2026

P a g e | 1 ITA No.9144/Del/2025 MDD Medical Systems (India) Pvt. Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, DELHI BEFORE SHRI M BALAGANESH, ACCOUNTANT MEMBER & SHRI ANUBHAV SHARMA, JUDICIAL MEMBER

ITA No.9144/Del/2025 (Assessment Year: 2018-19)

M.D.D Medical Systems Vs. DCIT, Circle 16(1) (India) Pvt. Ltd. CR Building, IP Estate Block L-3, Santram New Delhi – 110002 Complex, Street No.1, Mahipalpur Extension Delhi - 110037 स्थायीलेखासं./जीआइआरसं./PAN/GIR No: AADCM7793A Appellant .. Respondent Appellant by : Sh. Mukesh Jain, CA Sh. Samyak Jain, Adv. Respondent by : Sh. Rajesh Kumar Dhanesta, Sr. DR

Date of Hearing 29.04.2026 Date of Pronouncement 15.07.2026

O R D E R PER ANUBHAV SHARMA, JM:

This appeal is preferred by the assessee against the order dated 24.11.2025 of the Ld. Addl/JCIT(A)-9, Mumbai (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in DIN & Order No:

P a g e | 2 ITA No.9144/Del/2025 MDD Medical Systems (India) Pvt. Ltd. ITBA/APL/S/250/2025-26/1082947314(1) arising out of the assessment order dated 18.07.2022 u/s 154 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by ADIT, CPC, Bengaluru, for AY: 2018- 19.

2.

On hearing both sides we find that primarily the issue arises out of disallowance of the delayed deposit of contribution towards EPF amounting to Rs.3,73,242/- u/s 143(1)(a) of the Income Tax Act, 1961 and addition of Rs.3,93,106/- by way of rectification order u/s 154 of the Act on account of inconsistency in disallowance u/s 143B of the Act between return filed and Form 3CA -3CD.

3.

On hearing both sides we find that as with regard to disallowance of contribution received from employees towards EPF the contention of ld. Counsel is that the due date referred has to be considered in context to respective statute and it was submitted that the amounts were paid within one month of the date of payment of salary and thus according to the corresponding statute the amounts were paid in due date. This aspect can very well be considered by ld. AO after due verification in the light of decision of Hon’ble Supreme Court in Checkmate Services P. Ltd. CIT-1

P a g e | 3 ITA No.9144/Del/2025 MDD Medical Systems (India) Pvt. Ltd. (2022) (10) TMI 617 (SC) and therefore, we are inclined to allow the

corresponding grounds No. 2 for statistical purpose.

4.

Then with regard to disallowance made by AO of Rs.3,93,106/- u/s

43B of the Act. Ld. Counsel has demonstrated before us that the tax auditor

in Column No. 26(i)(B)(b) of Form 3CD, copy of which is available at page

No. 8 of the paper book it can be observed that following payments are

outstanding on the last day of physical year and not paid before filing of the

returns of income:

Particulars Amount (in INR) WCT Payable 56,59,374/- VAT Payable 10,56,908/- TDS Payable 10,913/- Total 67,27,195/-

5.

We find that while processing the return of assesse CPC has

disallowed the following:

Particulars Amount in the Amount mentioned in Variance return of Income Form Annexure 3CD Inconsistency in amount 12,07,772/- 67,27,195/- 55,19,423/- debited to Profit and Loss Account of the previous year but disallowable under section 43B

6.

Ld. Counsel has submitted that out of total payable of Rs.67,25,195/

only Rs.3,93,106/- belongs to the year under consideration remaining

P a g e | 4 ITA No.9144/Del/2025 MDD Medical Systems (India) Pvt. Ltd. Rs.63,26,176/- was the opening outstanding amount which relates to the

preceding years i.e., preceding to the years under consideration as depicted

in the table below:

Particulars Opening balance Addition/(deletion) Closing balance during the year WCT payable 52,66,268/- 3,93,106/- 56,59,374/- VAT Payable GOA 1,42,176/- - 1,42,176/- VAT Payable Kangra 7,85,557/- - 7,85,557/- HP VAT Payable – PATNA 4,97,529/- (3,68,354/-) 1,29,175/- Total 66,91,530 67,16,282

7.

Thus, in regard to this issue on the basis of aforesaid submissions as

expenditure is not claimed in profit and loss account, disallowance u/s 43B

is not sustainable. We accordingly allow ground No.3.

8.

As a consequence of aforesaid discussion the appeal of assesse is

partly allowed with consequences to follow as per determination of issues

above.

Order pronounced in the open court on 15.07.2026

Sd/- Sd/- (M Balaganesh) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated 15.07.2026 Rohit, Sr. PS

P a g e | 5 ITA No.9144/Del/2025 MDD Medical Systems (India) Pvt. Ltd. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI

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