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Income Tax Appellate Tribunal, DELHI BENCHES : SMC-I : NEW DELHI
Before: SHRI R.S. SYAL
ORDER This appeal filed by the assessee is directed against the order passed by the CIT(A) on 25.06.2014 in relation to the assessment year 2010-11.
The only issue raised in this appeal is against the confirmation of addition of Rs.4,36,613/- made by the AO on account of late payment of EPF and ESIC.
Briefly stated, the facts of the case are that the AO made disallowance of Rs.4,36,613/- on account of late deposit of employees’ contribution towards EPF and ESIC. The assessee contented that the deposits were made late under the respective Acts, but were, in fact, made before the due date of filing the return of income u/s 139(1) of the Act. The AO was not convinced, who made the disallowance. The ld. CIT(A) too upheld the disallowance.
I have heard the rival submissions and perused the relevant material on record. I find that the issue raised in the instant appeal is no more res integra. The Hon’ble Supreme Court in the case of CIT v. Alom Extrusions Limited [(2009) 319 ITR 306 (SC)] has held that the amendment to first proviso and omission of the second proviso to section 43B by the Finance Act, 2003 is retrospective. The Hon’ble Delhi High Court in the case of CIT v. Aimil Limited [(2010) 321 ITR 508 (Delhi)] has allowed deduction in respect of employees’ share when the amount was paid before the due date. When we consider these two judgments, it becomes patent that both the employer’s and employees’ contribution are allowable as deduction if the amount of provident fund etc., though belatedly, but is paid before the due date of filing of return u/s 139(1) of the Act. Adverting to the facts of the instant case, it is seen as an admitted position that the assessee deposited the employees’ contribution towards EPF and ESIC before the due date u/s 139(1) of the Act. Respectfully following the aforenoted judgment of the Hon’ble jurisdictional High Court, I order for the deletion of the addition.
In the result, the appeal is allowed.
The order pronounced in the open court on 08.08.2016.