RANBIR SINGH SOROUT,FARIDABAD vs. ITO,WARD-2(2), FARIDABAD

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ITA 53/DEL/2023Status: HeardITAT Delhi21 June 2023AY 2018-194 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 employee contributions to PF/ESI deposited after the due dates under the respective Acts, even if before the return filing date, are not deductible. This decision followed the Apex Court's ruling in Checkmate Services Pvt. Ltd.

What were the facts?

The assessee deposited employee contributions to PF/ESI after the due dates specified in the respective Acts, but before the income tax return filing due date. The Assessing Officer made additions on this ground, which were partly deleted by the CIT(A).

What were the issues?

Whether employee contributions to PF/ESI deposited after the statutory due dates under the respective Acts are allowable as a deduction under the Income Tax Act, despite being deposited before the return filing due date.

Which sections of the Income-tax Act were involved?

Section 36(1)(va),Section 43B,Section 37(1)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCH ‘F’ : NEW DELHI

For Respondent: Ms. Beenu, Sr. DR
Hearing: 19.06.2023

ASSESSEE BY : None REVENUE BY : Ms. Beenu, Sr. DR Date of Hearing : 19.06.2023 Date of Order : 21.06.2023

ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : These appeals are preferred by the assessee against the orders of ld.

CIT (Appeals) for the respective assessment years.

2.

Since the facts are identical and the appeals were heard together, these are being consolidated and disposed off by this common order.

AY 2017-18 which read as under :-

“1. That on the Facts and Circumstances of the case and in law, the order passed by the Ld. Assessing Officer (hereinafter referred to as Ld. AO) is bad in law and the appellant denies its liability to be assessed at income of Rs 64,46,470/- as against the returned income of Rs 42,72,440/-

2. That on the facts and circumstances of the case and in law, the Ld. Commissioner of Income Tax Appeals (hereinafter referred to as 'CIT (A)'), grossly erred in confirming the addition amounting to Rs 21,42,901/- of Employee Contribution of PF & ESI made under section 43(B) of the income tax act, 1961 which is uncalled for, based on surmises and conjectures and bad in law.

3.

That on the facts and circumstances of the case and in law, the Ld. Commissioner of Income Tax Appeals (hereinafter referred to as 'CIT (A)'), grossly erred in not allowing the expenditure, related to business expediency, amounting to Rs 21,42,901/- of Employee Contribution of PF & ESI under section 37(1) of the income tax act, 1961 which is uncalled for, based on surmises and conjectures and bad in law.”

4.

Brief facts of the case are that the assessee is an individual and proprietor, M/s Trident Industrial Solutions. The assessee has filed its return of income on 11.10.2018 declaring a total income of Rs.42,72,240/- for the AY 2017-18. The Centralized Processing Centre (CPC) while processing the return for the AY 2017-18, assessed the income of the appellant at Rs.64,46,470/- by making an addition of Rs.21,42,901/- u/s 36(1)(va) of the Act on the ground that the assessee deposited employees contribution of PF / ESI beyond the due date due date of filing of return of income. A further addition of Rs.9735/- was made u/s 37 of the Act on account of ESI penalty. An addition of Rs.21,400/- was also made by the AO on account of labour welfare u/s 43B of the Act.

5.

Upon assessee’s appeal, ld. CIT (A) deleted the addition for ESI penalty but confirmed the addition of Rs.21,42,901/- under section 36(1)(va) of the Income-tax Act, 1961 (for short 'the Act') on the ground that assessee deposited employees provident fund beyond the due date specified under PF/ESI Act.

6.

Against this order, assessee is in appeal before us. None appeared on behalf of the assessee. Hence, we are going to adjudicate the appeal after hearing the ld. DR for the Revenue and perusing the material on record.

7.

Upon careful consideration, we find that this issue is fully settled in favour of the Revenue by the decision of Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd. (2022) 143 taxmann.com 178 wherein it has been held that if employee contribution of provident fund and ESI paid beyond due date as specified under the relevant Act then the same has to be added back in the income of the assessee. Respectfully

Our above order applies mutatis mutandis in case of & 8. 54/Del/2023 for AYs 2018-19 & 2019-20.

9.

In the result, all the appeals filed by the assessee are dismissed. Order pronounced in the open court on this 21st day of June, 2023.

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