WINGS BIOTECH LLP,NEW DELHI vs. ACIT CIRCLE-43(1), DELHI
What did the Tribunal hold?
The Tribunal held that for deposits made on the next working day after a Sunday due date, the deposit is considered timely. However, the disallowance for other late deposits is sustained. The assessee's claim for deduction under Section 80IC on the disallowed amount needs to be considered by the AO.
What were the facts?
The assessee, Wings Biotech LLP, appealed against an addition of Rs. 21,38,393 made on account of late deposit of EPF. The delay was for a few days in most cases, and for the last three deposits, the due date was a Sunday.
What were the issues?
Whether late deposit of EPF, especially when the due date falls on a Sunday, should lead to disallowance. Whether such disallowance is eligible for deduction under Section 80IC.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cases cited in this judgment(1)Show listHide list
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- Checkmate Services Pvt. Ltd. v. CIT1,392 citing448 ITR 518 · 2022 · SC · Read judgment
Income Tax Appellate Tribunal, DELHI BENCH ‘H’, NEW DELHI
Before: SH. N. K. BILLAIYA & SH.KUL BHARAT
This appeal by the assessee is preferred against the order dated 10.06.2022 by NFAC, Delhi pertaining to A.Y. 2018-19.
The short grievance of the assessee is that the CIT(A)/ NFAC erred in sustaining the addition of Rs.2138393/- on account of late deposit of EPF.
Representatives of both the sides were heard at length. Case records carefully perused. There is no dispute in so far as the fact of delay in deposit of EPF is concerned and the same is clear from the following chart :-
Due date of payment Actual date of payment Amount 15.06.2017 16.06.2017 387394 15.07.2017 17.07.2017 190786 15.09.2017 16.09.2017 348586 15.10.2017 17.10.2017 212819 15.11.2017 17.11.2017 365486 15.04.2018 16.04.2018 210753 16.04.2018 15.04.2018 30820 16.04.2018 15.04.2018 391749
It has been pointed out to us that last three deposits shown in the chart are dated 16.04.2018 when the due date was 15.04.2018. It has been further brought to our notice that on 15.04.2018 was Sunday and, therefore, as per section 10 of General Clauses Act 1977 if the court or office is closed on the due date the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the court or office is opened.
We find force in this claim of the Counsel since the due date i.e. 15.04.2018 was Sunday, therefore, the next working day i.e. 16.04.2018 becomes the due date and, therefore, the sum deposited on 16.04.2018 has to be allowed and the balance amount stands disallowed.
The counsel further made a claim that the assessee is eligible for deduction u/s. 80IC of the Act, therefore, any such disallowance is eligible for the deduction u/s. 80 IC of the Act. A similar view was taken by the coordinate Bench in the case of the assessee for A.Y.2017-18 in ITA No.531/Del/2023.
We are of the considered view that the decision of the Hon’ble Supreme Court in the case of Check Mate Services Private Limited 448 ITR 518 squarely apply on the facts of the case, but at the same time the claim of deduction u/s. 80IC cannot be ignored, therefore, to this extent we direct the AO to consider the claim as per the relevant provisions of the law after affording a reasonable and adequate opportunity of being heard to the assessee.
In the result, the appeal of the assessee is allowed in part for statistical purpose.
Decision announced in the open court on 31.08.2023.
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