INDIAN PUBLIC SCHOOL PVT. LTD.,COIMBATORE vs. DCIT, CPC, , BANGALORE

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ITA 1521/CHNY/2024Status: DisposedITAT Chennai22 July 2024AY 2018-19Bench: Shri S.S. Viswanethra Ravi (Judicial Member), Shri S.R. Raghunatha (Accountant Member)3 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the belated deposit of employees' PF and ESI contributions, even if made before the due date of filing the return of income, would be treated as income of the assessee for not depositing them within the statutory due date. Therefore, the disallowance was upheld.

What were the facts?

The assessee remitted employees' PF and ESI contributions belatedly, after the due date prescribed under the relevant statute, although within the due date for filing the return of income. The lower authorities confirmed the disallowance of these contributions.

What were the issues?

Whether employees' PF and ESI contributions deposited after the statutory due date but before the due date of filing the return of income are allowable as a deduction.

Which sections of the Income-tax Act were involved?

Section 36(1)(va),Section 139(1)

AI-generated summary — verify with the full judgment below

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Before: Shri S.S. Viswanethra Ravi & Shri S.R. Raghunatha

Hearing: 22.07.2024Pronounced: 22.07.2024

O R D E R

PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:

1.

This appeal filed by the assessee is directed against the order dated 05.03.2024 passed by the Addl/JCIT(A)-2, Surat for the assessment year 2018-19.

2.

We find that this appeal is filed with a delay of 16 days. None appeared on behalf of the assessee. However, the assessee filed a petition for condonation of delay as well as duly notarized affidavit stating reasons for the said delay and prayed for condonation of that delay. On perusal of the affidavit and upon hearing the ld. DR, we find that the reasons explained by the assessee are bonafide and therefore, the delay is condoned.

3.

The assessee has raised 5 grounds of appeal amongst which, the only effective issue raised by the assessee challenging the action of ld. Addl./JCIT(A) in treating employees’ PF and ESI contribution as income by invoking the provisions of section 36(1)(va) of the Income Tax Act, 1961 [“Act” in short].

4. We note that the assessee remitted employees’ PF and ESI contribution within the due date of filing of return of income under section 139(1) of the Act. The CPC disallowed the said amount for not depositing the same within due date as prescribed under relevant Act. The Addl./ JCIT(A) confirmed the said order.

4. The fact remain admitted that the assessee deposited employees’ PF contribution belatedly, not within due date prescribed under relevant statute and in view of the decision of the Hon’ble Supreme Court in the case of Checkmate Services Pvt. Ltd. v. CIT [2022] 143 taxmann.com 178 (SC), the contribution, though deposited within the due date of filing of return of income under section 139(1) of the Act, it is the income of the assessee for not depositing the same within the due date of relevant statute. Therefore, we find no infirmity in the order of the Addl./JCIT(A) in considering the said employees’ PF contribution as income of the assessee. Thus, the ground raised by the assessee is dismissed.

5.

In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on 22nd July, 2024 at Chennai.

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