CLEARSYNTH LABS LIMITED,MUMBAI vs. DCIT 1(2)(1), MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI

BEFORE SHRI VIKRAM SINGH YADAV, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No.9481/Mum/2025 (Assessment Year: 2020-21)

M/s. Clearsynth Labs Limited, National Faceless Appeal Centre 17th Floor, Lotus Business Park, (NFAC), DCIT 1(2)(1), New Link Road, Vs. Mumbai Azad Nagar S. O., Mumbai – 400 053 PAN:AADCC9150H (Appellant) (Respondent) :

: Shri Wasim Shaikh, AR Assessee by Respondent by : Shri Virabhadra Mahajan, Sr. DR

Date of Hearing : 30.03.2026 Date of Pronouncement : 27.04.2026

O R D E R Per Kavitha Rajagopal, JM:

This appeal is filed by the assessee challenging the order of the Learned

Commissioner of Income Tax (Appeals) [‘Ld. CIT(A)’ for short], National Faceless Appeal

Centre (“NFAC” for short) passed u/s. 250 of the Income Tax Act, 1961 (‘the Act'), relevant

to Assessment Year (‘A.Y.’ for short) 2020-21.

“1. The National Faceless Appeal Centre (NFAC) has erred in law and on facts in confirming the disallowance of a sum of ₹23,56,682/ under section 36(1)(va) of the Income-tax Act, 1961, on account of alleged delayed deposit of employees' contribution to PF, without appreciating that out of the said amount, only ₹11,32,648/-pertained to employees' contribution, whereas the balance amount of ₹12,24,034/- represented employer's contribution, which is allowable as a deduction under section 43B of the Act, having been deposited within the due date of filing of return of income.

ITA No.9481/Mum/2025 M/s. Clearsynth Labs Limited 1961, on account of alleged delayed deposit of employees' contribution to ESIC, without appreciating that out of the said amount, only ₹47,412/- pertained to employees' contribution, whereas the balance amount of ₹1,70,267/-represented employer's contribution, which is allowable as a deduction under section 43B of the Act, having been deposited within the due date of filing of return of income.

company and had filed its return of income declaring total loss at Rs.1,93,32,442/- under

the normal provisions and book profit under section 115JB of the Act at Rs.2,94,32,383/-

and the same was processed u/s 143(1) of the Act. The case of the assessee was selected

for scrutiny under CASS and notices u/s 143(2) & 142(1) of the Act were duly issued and

served upon the assessee. The Learned Assessing Officer (“for short “Ld. AO”) passed the

assessment order dated 13.09.2022 u/s 143(3) r.w.s. 144B of the Act after making an

addition/disallowance of Rs.23,56,682/- u/s 36(1)(va) of the Act towards belated deposit

of PF and Rs.2,17,692/- towards ESIC aggregating to Rs.25,74,361/- pertaining to the

employees’ contribution to PF & ESIC.

order dated 18.11.2025 dismissed the appeal filed by the assessee by relying on the decision

of Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd. vs. CIT (2022) 448

ITR (SC).

ITA No.9481/Mum/2025 M/s. Clearsynth Labs Limited 5. Aggrieved, the assessee is in appeal before us, challenging the order of the Ld.

CIT(A).

It is observed that the assessee had made a disallowance towards belated deposit of PF &

ESIC which was deposited after due date prescribed under the relevant Acts though before

the filing the return of income. It is now a settled proposition of law by the decision of the

Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd. (supra) that the belated

deposit of PF & ESIC towards employees’ contribution after due date prescribed under the

relevant Acts, even if it is before the filing of return of income, is not an allowable claim

as per section 36(1)(va) of the Act.

the assessee is that the disallowance made by the Ld. AO and upheld by the Ld. CIT(A)

also includes employer’s contribution u/s 43B of the Act which is not covered by the

decision of the Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd. (supra)

and hence prayed that the same shall be allowed after due verification. The Ld. AR also

contended that the lower authorities have failed to consider the same though the assessee,

in the paper book filed by it, has bifurcated the employer’s and employees’ contribution

and that there was an inadvertent error in the tax audit report in form 3CD clause 20(b) of

the Act which had included employer’s contribution along with employees’ contribution.

Apex Court pertains to the belated deposit of employee’s contribution where the assessee

is duty bound to deposit the same on or before the due date prescribed under the relevant 3

ITA No.9481/Mum/2025 M/s. Clearsynth Labs Limited Acts and the same does not pertain to employer’s contribution claimed u/s 43B of the Act.

The assessee has categorically specified that there was an inadvertent error in not

bifurcating the employer and employees’ contribution in the tax audit report. We,

therefore, deem it fit to remand this issue back to the file of the Ld. AO to verify whether

the disallowance includes employer’s contribution which is otherwise allowable in

accordance with section 43B of the Act. The assessee is directed to furnish all the relevant

documentary evidences in support of its claim without any undue delay from its side.

Therefore, the grounds of appeal raised by the assessee are hereby allowed for statistical

purpose.

Order pronounced in the open court on 27.04.2026

Sd/- Sd/- (VIKRAM SINGH YADAV) (KAVITHA RAJAGOPAL) ACCOUNTANT MEMBER JUDICIAL MEMBER

Mumbai; Dated: 27.04.2026 * Kishore, Sr. P.S. Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER,

(Dy./Asstt.Registrar) ITAT, Mumbai