WINJIT TECHNOLOGIES P LTD,NASHIK vs. ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1, NASHIK

आदेश / ORDER

PER R.S. SYAL, VP :

This appeal by the assessee is directed against the order

dated 24-03-2021 passed by the National Faceless Appeal Centre

(NFAC), Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter

also called ‘the Act’) in relation to the assessment year 2018-19.

confirmation of disallowance of Rs.28,21,112/- made by the

Assessing Officer (AO) u/s.36(1)(va) of the Act on account of late

deposit of the Employees’ share of EPF and ESI etc.

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disallowance of Rs.28,21,112/- in the intimation u/s.143(1) of

the Act on the ground that the assessee late deposited the

employees’ share of EPF and ESI etc. The ld. CIT(A) affirmed

the disallowance.

material on record. It is seen as an admitted position that the

assessee did deduct employees’ share of EPF and ESI and paid

the same after the due date under the respective legislations but

before the time stipulated for filing return u/s 139(1) of the Act.

In our opinion, this issue is no more res integra in view of several

judgments allowing deduction u/s 36(1)(va) of employees’ share

of contribution deposited after due date under the respective Acts

but before the date prescribed u/s 139 of the Act. The Hon’ble

Himachal Pradesh High Court in CIT vs. Nipso Polyfabriks Ltd.

(2013) 350 ITR 327 (HP) has held that there exists no difference

between employees or employer’s contribution and both are to be

allowed as deduction if deposited before the due date.

2021 has inserted Explanation 2 below section 36(1)(va)

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providing that the provisions of section 43B shall not apply for

the purpose of determining the due date under this clause w.e.f.

01.04.2021. The effect of this amendment is that if the amount of

employees’ contribution towards EPF, ESI, etc is delayed by an

employer beyond the due date under the respective Acts, the

disallowance will be called for notwithstanding the fact that it was

deposited before the due date u/s 139 of the Act. The

Memorandum explaining the provisions of the Finance Bill, 2021, provides that this amendment will take effect from 1st April, 2021

and will, accordingly apply in relation to assessment year 2021-

2022 and subsequent assessment years. Since the assessment year

under consideration is 2018-19, which is anterior to the

amendment carried out with effect from A.Y. 2021-22, we hold

that the position of law as set out by various Hon’ble High Courts

including the one in CIT vs. Nipso Polyfabriks Ltd. (supra)

squarely applies to the facts and circumstances of the instant case,

thereby not warranting any disallowance since the amount in

question was admittedly deposited before due date u/s 139(1) of

the Act. The addition is therefore, directed to be deleted.

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Order pronounced in the Open Court on 24th June, 2022.

Sd/- Sd/- (S.S. VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 24th June, 2022 सतीश

आदेश की �ितिलिप अ�ेिषत/Copy of the Order is forwarded to: अपीलाथ� / The Appellant; 1. ��थ� / The Respondent 2. 3. NFAC, Delhi 4. The CIT concerned 5. DR, ITAT, ‘B’ Bench, Pune गाड� फाईल / Guard file. 6. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune

ITA No.204/PUN/2021 Winjit Technologies Private Limited

Date 1. Draft dictated on 24-06-2022 Sr.PS 2. Draft placed before author 24-06-2022 Sr.PS 3. Draft proposed & placed before JM the second member 4. Draft discussed/approved by JM Second Member. 5. Approved Draft comes to the Sr.PS Sr.PS/PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *