(i) CIT v. Merchem Ltd.

378 ITR 443High Court2015#89 most cited

What is (i) CIT v. Merchem Ltd. authority for?

Belated remittance of employees' contribution to ESI and PF, even if deposited before the due date for filing the return of income under Section 139(1), is not allowed as a deduction. This disallowance falls under Section 36(1)(va) read with Section 2(24)(x), as Section 43B applies only to employer's contributions.

631

judgments rely on this decision, according to BharatTax’s citation analysis of 292,668 Indian tax judgments — from 2018 to 2025.

Also referred to as

CIT v. Merchem Ltd. · 378 ITR 443 · Section 36(1)(va) · Section 2(24)(x) · employees' contribution ESI PF · belated remittance · disallowance of deduction · Section 139(1) · Section 43B · Checkmate Services

Sections most often in play

Section 139(1)Section 143(1)

Issues it is cited on

section 43b(b)clarificatory amendmentretrospective amendmentsection 2(24)(x)section 36(1)(va)section 43bsection 2(24)section 36(1)section 43section 36section 139(1)section 139

Judgments citing (i) CIT v. Merchem Ltd.

SREEJITH VELAPPAN RADHAMONY,THIRUVANANTHAPURAM vs. DCIT,CIRCLE 1(1), TRIVANDRUM

In the result, the appeal filed by the assessee stands dismissed

ITA 982/COCH/2024[2018-19]Status: DisposedITAT Cochin13 Jun 2025AY 2018-19

Bench: Shri Inturi Rama Rao, Am & Shri Sonjoy Sarma, Jm Assessment Year: 2018-19 Sreejith Velappan Radhamony .......... Appellant Tc 23/169, Knra 88, Lekshmi Varaham Valiyalasala, Chala P.O., Trivandrum 695036 [Pan: Ahhpr8214M] Vs. Dcit, Circle-1(1), Thiruvananthapuram .......... Respondent Appellant By: Smt. Nivedita A. Kamat, Advocate Respondent By: Smt. Leena Lal, Sr. D.R. Date Of Hearing: 05.06.2025 Date Of Pronouncement: 13.06.2025

For Appellant: Smt. Nivedita A. Kamat, AdvocateFor Respondent: Smt. Leena Lal, Sr. D.R
Section 139(1)Section 143(1)Section 3

…ing belated remittance of ESI & PF contributions. She further submits that even before the judgement of the Hon'ble Apex Court in the case of Checkmate Services Pvt. Ltd. (supra), the Hon'ble Jurisdictional High Court in the case of CIT v. Merchem Ltd. [2015] 378 ITR 443 and Popular Vehicles & Services Pvt. Ltd. v. CIT [2018] 96 Taxmann.com 13 took a view that deposit of employees’ contribution towards ESI & PF beyond the due date stipulated under the respective statutes but deposited before the due date prescribed u/s. 3 Sreejith Velappan Radhamony 139(1) of the Act for filing the return of income cannot be al…

SALKARA RESTAURANT,CALICUT vs. THE ITO, KOZHIKKODE

Appeal is dismissed

ITA 79/COCH/2022[2019-20]Status: DisposedITAT Cochin30 Oct 2024AY 2019-20

Bench: Shri Inturi Rama Raosalkara Restaurant The Income Tax Officer-1(3) West Nadakkavu Aayakar Bhavan Vandipetta Vs. Mananchira Kozhikode 673001 Kozhikode 673001 [Pan: Abyfs8116J] (Appellant) (Respondent)

For Appellant: ------- None -------For Respondent: Smt. Leena Lal, Sr. D.R
Section 143(1)

…ourt in the case of Checkmate Services Pvt. Ltd. v. Pr. CIT(in Civil Appeal No.2833 of 2016) as well as the judgements of Hon'ble Jurisdictional High Court in the case Inditrade Capital Ltd. v. CIT [2024] 167 taxmann.com 82 (Ker) and CIT v. Mechem Ltd. [2015] 378 ITR 443 (Ker). Therefore we do not find any illegality in making adjustment of belated remittance of contribution to employees’ towards PF & ESI. 3 Salkara Restaurant 8. This assessee’s appeal is dismissed. Order pronounced in the open court on 30th October, 2024 (Inturi Rama Rao) Accountant Member Cochin, Dated: 30th October, 2024 n.p. Copy to: 1. T…

P. SURENDRAN,TRIVANDRUM vs. ACIT CIRCLE 1(2), TRIVANDRUM

In the result, the appeal filed by the assessee is partly allowed for statistical

ITA 978/COCH/2022[2014-15]Status: DisposedITAT Cochin14 May 2024AY 2014-15

Bench: Shri Sanjay Arora, Am & Ms. Kavitha Rajagopal, Jm P. Surendran Sukanya Bhavan Asst. Cit-1(2) Vadayakkadu, Kunnukuzhy, P.O., Thiruvananthapuram Vs. Thiruvananthapuram-695 035

For Respondent: Smt. J M Jamuna Devi
Section 133ASection 143(2)Section 143(3)Section 250Section 36(1)(va)Section 40A(3)Section 40a

…ly covered by the decision of the Hon'ble Apex Court in the case of Checkmate Service Pvt. Ltd. vs. CIT (in Civil Appeal No. 2833 vide order dated 12.10.2022) and also the decision of the Hon'ble Jurisdictional High Court in the case of CIT vs. Merchem Ltd. 378 ITR 443 (Ker.) against the assessee, we deem it fit to dismiss this ground raised by the assessee. Therefore, ground no. 6 raised by the assessee is dismissed. 23. Ground no. 7 is disallowance on non deduction of TDS amounting to Rs.1 lac. The assessee has challenged the grounds of disallowance made by the ld.AO and confirmed by the ld. CIT(A) on the…

LAKESHORE HOSPITAL AND RESEARCH CENTRE LIMITED,KOCHI vs. ACIT, CORPORATE CIRCLE 1(2), KOCHI

In the result, the assessee’s appeal is allowed

ITA 71/COCH/2023[2016-17]Status: DisposedITAT Cochin28 Dec 2023AY 2016-17

Bench: Shri Sanjay Arora & Shri Manomohan Daslakeshore Hospital & Rsearch Dy. Cit, Corporate Circle Centre Ltd. 1(1), C.R. Building, Xvi Maradu, Nh 47 Bye Pass Vs. Is Press Road, Netoor P.O., Kochi 682040 Kochi 682018 [Pan:Aaacl4923A] (Appellant) (Respondent)

For Appellant: Ms. Rohini V. Thampi, CAFor Respondent: Smt. J.M. Jamuna Devi, Sr. D.R
Section 10Section 143(3)Section 154Section 36(1)(va)Section 43B

…by the Hon'ble jurisdictional High CourtinCIT vs. South India Corporation Ltd. [2020] 423 ITR 158 (Ker);CIT v. Harrisons Malayalam Ltd.[2019] 414 ITR 718 (Ker);Popular Vehicles& Services P. Ltd. vs. CIT [2018] 406 ITR 150 (Ker); and CIT vs. Merchem Ltd.[2015] 378 ITR 443 ITANo. 71/Coch/ 2023 (AY 2016-17) Lakeshore Hospital and Research Centre Ltd. vs. Dy. CIT (Ker), all to the effect that employee’s contribution to the employee welfare fund is covered u/s. 36(1)(va) read with s. 2(24)(x) of the Act, and not u/s. 43B of the Act, which concerns the employer’s contribution thereto only. The assessee’s explanation o…

PRINCIPAL COMMISSIONER OF INCOME TAX 1 KOLKATA vs. M/S GARDEN REACH SHIPBUILDERS AND ENGINEERS LTD

The appeal is allowed and the order passed by the Tribunal is set aside

ITAT/217/2023HC Calcutta16 Oct 2023

Bench: THE HON'BLE THE CHIEF JUSTICE T.S SIVAGNANAM,HON'BLE JUSTICE HIRANMAY BHATTACHARYYA

Section 2(24)(x)Section 260ASection 36(1)(va)

…due date without considering the decisions of the Hon’ble Madras High Court in the case of Unifac Management Service (India) Private Limited vs. DCIT (2018) 409 ITR 225, decision of the Hon’ble Kerala High Court in the case of M/s. Merchem Limited reported in 378 ITR 443 and the decision of the Hon’ble Bombay High Court in case of M/s. Ghatge Patil Transport Limited reported in 368 ITR 749 and also violating the provisions of Section 2(24)(x) read with Section 36(1)(va) of the Income Tax Act, 1961 ?” The substantial question of law which has been raised is squarely covered in favour of the appellant/department in…

M/S CHEMPAKA KINDERGARTEN PVT. LTD.,TRIVANDRUM vs. THE CIT (APPEALS), CIRCLE 1(1), THIRUVANANTHAPURAM, THIRUVANANTHAPURAM

In the result, the assessee’s appeal is dismissed

ITA 791/COCH/2022[2019-2020]Status: DisposedITAT Cochin07 Sept 2023AY 2019-2020

Bench: Shri Sanjay Arora, Am &Shri Manomohan Das, Jm

For Appellant: Smt.Telma Raju, AdvocateFor Respondent: Smt.J.M.Jamuna Devi, Sr.DR
Section 154Section 2(24)(x)

…ng not made in compliance with s.36(1)(va), the deemed income u/s. 2(24)(x) would consequently not be eligible for deduction there-under. This, in fact, has been the consistent stand of the Hon’ble jurisdictional High Court, as in CIT v. Merchem Limited[2019] 378 ITR 443 (Ker); Popular Vehicles & Services Private Limited v. CIT [2018] 406 ITR 150 (Ker); CIT v. Apollo Tyres Ltd. [2022] 447 ITR 377 (Ker). Further, it is trite law that rectification of an order could be made on the basis of a decision by the Hon’ble Apex Court or the Hon’ble jurisdictional High Court, even if rendered after the date of the order sou…

BHUNESHWAR PRASAD SAHU, BALODA BAZAR,RAIPUR vs. DEPUTY COMMISSIONER OF INCOME TAX, CPC, JAO INCOME TAX OFFICER, BHATAPARA, BHATAPARA

ITA 64/RPR/2022[2018-19]Status: DisposedITAT Raipur10 Aug 2023AY 2018-19

Bench: Shri Ravish Sood & Shri Arun Khodpiaआयकर अपील सं. / Ita No. 64/Rpr/2022 "नधा"रण वष" / Assessment Year : 2018-19 Bhuneshwar Prasad Sahu Main Road, Raseda, Baloda Bazar, Raipur (C.G.) Pan : Batps7721N .......अपीलाथ" / Appellant बनाम / V/S. The Deputy Commissioner Of Income Tax, Cpc, Jao-Income Tax Officer, Bhatapara ……""यथ" / Respondent

For Appellant: Shri S.R. Rao, AdvocateFor Respondent: Shri Satya Prakash Sharma, Sr. DR
Section 139(1)Section 143(1)Section 143(1)(a)Section 154Section 36(1)(va)Section 43B

…ble Courts have held that the provisions of section 43(B) could not apply to employees' contribution u/s 36(1)(va). This contrary view is supported by the decisions of the following Hon'ble High courts, amongst several others :- (i) CIT v/s Merchem Ltd. [2015]378 ITR 443(Ker) (ii) CIT v/s Gujarat State Road Transport Corporation (2014) 366 ITR 170(Guj.) (iii) CIT v/s South India Corporation Ltd.(2000) 242 ITR 114(Ker) 6 Bhuneshwar Prasad Sahu Vs. DCIT, CPC, JAO-ITO, Bhatapara (iv) CIT v/s GTN Textiles Ltd.(2004)269 ITR 282(Ker) (v) CIT v/s Jairam & Sons [2004]269 ITR 285(Ker) 5.6 It is pertinent to note that in…

COCHIN PORT AUTHORITY ( FORMERLY COCHIN PORT TRUST),KOCHI vs. DCIT NON CORPORATE CIRCLE 2(1), KOCHI, KOCHI

In the result, the assessee’s appeal is partly allowed

ITA 655/COCH/2022[2017-2018]Status: DisposedITAT Cochin10 Jul 2023AY 2017-2018

Bench: Shri Sanjay Arora, Am &Shri Manomohan Das, Jm

For Appellant: Sri.Gopi K, CAFor Respondent: Sri.Sajit Kumar Das, CIT-DR
Section 143(3)Section 2(24)(x)Section 260ASection 263Section 36(1)(iv)Section 36(1)(va)Section 43B

…n of the matter by the AO. Further, the consistent stand by the Hon'ble jurisdictional High Court in the matter is to the contrary. And toward which we may cite some decisions, as in CIT v. South India Corporation[2000] 242 ITR 114 (Ker); CIT v. Merchem[2015] 378 ITR 443 (Ker) and Popular Vehicles& Services (P.) Ltd. v. CIT [2018] 406 ITR 150 (Ker).Coming to the decision in Kerala State Warehousing Corporation (supra), the same, as its reading (PB page 29-30) shows, is qua sec.43B, which is only in respect of employers’ contribution, deductible u/s. 36(1)(iv). Again, even if regarded as falling within the ambit o…

M/S SREELEKSHMI CASHEW COMPANY,KOLLAM vs. THE ITO, WARD 1 & TPS, KOLLAM

In the result, the appeal by the assessee is dismissed

ITA 879/COCH/2022[2017-18]Status: DisposedITAT Cochin12 Jun 2023AY 2017-18

Bench: Shri Sanjay Arora & Shri Aby T.Varkeysreelekshmi Cashew Company The Income Tax Officer Lekshmi Prabha, Kadappakkada Ward - 1 & Tps, Kollam Vs. Kollam 691008 [Pan:Aazfs1211Q] (Appellant) (Respondent) Appellant By: Shri T.V. Hariharan, Ca Respondent By: Dr. Prasanth V.K., Cit-Dr

For Appellant: Shri T.V. Hariharan, CAFor Respondent: Dr. Prasanth V.K., CIT-DR
Section 139(1)Section 143(3)Section 2(24)(x)Section 263Section 36Section 36(1)(va)Section 37(1)Section 43BSection 44A

…derstand the cause of the assessee’s grievance. Beginning the decision in CIT vs. South India Corporation Ltd. [2000] 242 ITR 114 (Ker), the Hon'ble jurisdictional High Court has, per a series of decisions, including Merchem Limited (supra), reported at[2015] 378 ITR 443 (Ker)and Popular Vehicles & Services P. Ltd.(supra), reported at[2018] 406 ITR 150 (Ker),clarified that while deduction of the employer’s contribution to the Employees’ Welfare Funds is governed by section 37(1), the employees’ contribution thereto is, on the other hand, by section 36(1)(va) of the Act. Section 37(1) excludes from its ambit, besi…

M/S KANAKA POLYPACK PRIVATE LIMITED,ALUVA vs. ACIT CORPORATE CIRCLE 1(1), KOCHI

In the result, appeal of the assessee is dismissed

ITA 876/COCH/2022[2018-19]Status: DisposedITAT Cochin08 Mar 2023AY 2018-19

Bench: Shri George George K & Ms. Padmavathy Sassessment Year :2018-19 M/S. Kanaka Polypack Private Limited, Acit, Vs. Xvi, Keezhmad Panchayat, Corporate Circle - 1(1), Ashokapuram,Aluva, Kochi – 682 018. Ernakulam District, Kerala – 683 101. Pan :Aafck 1498 J Assessee Respondent

For Appellant: Shri. Manu Kurian, CAFor Respondent: Smt. J M Jamuna Devi, Sr. AR
Section 139(1)Section 143(1)Section 154Section 34(1)(iv)Section 36(1)(va)Section 43B

…t. The Hon’ble Supreme Court upheld the view of the Hon’ble Gujarat and Kerala High Court in CIT v. Gujarat State Road Transport Corpn. [2014] 41 taxmann.com 100/ 366 ITR 170/223 Taxman 398 (Guj.), CIT v. Merchant Ltd. [2015] 61 taxmann.com 119/235 Taxman 291/378 ITR 443 (Ker.) which was to the effect that Section 36(1)(va) and Section 43B(b) operate on totally different equilibriums and have different parameters for due dates, i.e., employee's contribution is linked to payment before the due dates specified in the respective Acts and employer's contribution is linked to payment before the due dates specified in…

M/S BRMSCO GARMENTS PRIVATE LIMITED,ERNAKULAM vs. ITO CORPORATE WARD -1, KOCHI

In the result, the appeal filed by the assessee is dismissed

ITA 877/COCH/2022[2019-20]Status: DisposedITAT Cochin03 Mar 2023AY 2019-20

Bench: Shri George George K. & Ms. Padmavathy S.M/S. Brmsco Garments Pvt. Ltd. Vs The Income Tax Officer V/103A Onakkur, Pampakuda Corporate Ward -1 Anchalpetty P.O. Kochi Ernakulam 686667 Pan – Aadcb2001L (Appellant) (Respondent)

For Appellant: Shri Shijoy K.G., FCAFor Respondent: Smt. J.M. Jamuna Devi, Sr. DR
Section 139(1)Section 143(1)Section 250

…n 139(1) of the Act. Therefore, it is entitled to the deduction claimed. The CIT(A), however, rejected the contention of the assessee. The CIT(A), following the judgement of the Hon'ble Jurisdictional High Court in the case of CIT vs. Merchem Ltd. reported in 378 ITR 443 decided the issue against the assessee. 5. Aggrieved, assessee filed the present appeal before the Tribunal. The learned A.R. relied on the grounds raised. 6. The learned D.R., on the other hand, submitted that the issue is covered in favour of the Revenue by the judgement of the Hon'ble Apex Court in the case of Checkmate Services (P) Ltd. vs.…

DODDAIAH KAVITHA,BANGALORE vs. DEPUTY COMMISSIONER OF INCOME TAX, CPC, BANGALORE

In the result, appeal of the assessee is dismissed

ITA 952/BANG/2022[2018-19]Status: DisposedITAT Bangalore02 Feb 2023AY 2018-19

Bench: Shri N. V. Vasudevanassessment Year : 2018-19 Ms. Doddaiah Kavitha, Vs. Dcit, No.1/1, 57Th ‘D’ Cross, 3Rd Block, Central Processing Centre, Rajajinagar, Bengaluru. Bengaluru – 560 010. Pan : Boypk 6785 B Appellant Respondent Assessee By : Shri. Manishankar S, Ca Revenue By : Shri. Ganesh R. Ghale, Standing Counsel Date Of Hearing : 31.01.2023 Date Of Pronouncement : 02.02.2023 O R D E R This Is An Appeal By The Assessee Against The Order Dated 26.07.2022 Of Nfac, Delhi, Relating To Assessment Year 2018-19. 2. The Issue Involved In This Appeal Is As To Whether The Employees’ Contribution To Provident Fund & Employees State Insurance Which The Employer Deducts & Pays Over To The Concerned Authorities Beyond The Date Prescribed For Payment Of Such Contribution But Nevertheless The Contribution Has Been Paid Within The Due Date Prescribed For Filing Return Of Income U/S.139(1) Of The Income Tax Act, 1961, Can Be Allowed As Deduction By Applying The Second Proviso To Sec.43B Of The Act. 3. In So Far As The Question Whether The Employees Contribution To Provident Fund & Employees State Insurance Which The Employer Deducts & Pays Over To The Concerned Authorities Beyond The Date Prescribed For Page 2 Of 6

For Appellant: Shri. Manishankar S, CAFor Respondent: Shri. Ganesh R. Ghale, Standing Counsel
Section 139(1)Section 2(24)(x)Section 34(1)(iv)Section 36(1)(va)Section 43B

…t. The Hon’ble Supreme Court upheld the view of the Hon’ble Gujarat and Kerala High Court in CIT v. Gujarat State Road Transport Corpn. [2014] 41 taxmann.com 100/ 366 ITR 170/223 Taxman 398 (Guj.), CIT v. Merchant Ltd. [2015] 61 taxmann.com 119/235 Taxman 291/378 ITR 443 (Ker.) which was to the effect that Section 36(1)(va) and Section 43B(b) operate on totally different equilibriums and have different parameters for due dates, i.e., employee's contribution is linked to payment before the due dates specified in the respective Acts and employer's contribution is linked to payment before the due dates specified in…

GANNON DUNKERLEY & CO LTD,MUMBAI vs. DY COMMISSIONER OF INCOME TAX CIRCLE-1(1)(1), MUMBAI

ITA 2228/MUM/2022[2019-20]Status: DisposedITAT Mumbai22 Dec 2022AY 2019-20

Bench: Shri Om Prakash Kant () & Shri Rahul Chaudhary () Assessment Year: 2019-2020 Gannon Dunkerley & Co. Ltd, Dy. Cit, Circle-1(1)(1), 3Rd Floor, New Excelsior Aayakar Bhavan, Building Ak Nayak Marg, Fort, Vs. Mumbai-400020. Mumbai-400 001. Pan No. Aaacg 1846 P Appellant Respondent : Assessee By Mr. Babulal Sharma, Ar : Revenue By Mr. Sanjay Vishwas Rao Deshmukh, Dr Date Of Hearing : 02/11/2022 Date Of Pronouncement : 22/12/2022

For Respondent: Assessee by Mr. Babulal Sharma, AR
Section 2(24)(x)Section 36(1)(va)

…he Department. No. 22/2015 issued by the Department. A similar view has been taken by the Kerala High Court A similar view has been taken by the Kerala High Court A similar view has been taken by the Kerala High Court in the case of CIT vs. Merchem Ltd (2015) 378 ITR 443. in the case of CIT vs. Merchem Ltd (2015) 378 ITR 443. in the case of CIT vs. Merchem Ltd (2015) 378 ITR 443. 7.11 But at the same time, on the identical issue the But at the same time, on the identical issue the But at the same time, on the identical issue the following decisions are in following decisions are in favour of assessee. i. favour o…

M/S. SURESH ELECTRICALS,BELLARY vs. THE DEPUTY COMMISSIONER OF INCOME TAX, CPC, BENGALURU

In the result, appeal of the assessee is dismissed

ITA 724/BANG/2022[2018-19]Status: DisposedITAT Bangalore25 Nov 2022AY 2018-19

Bench: Shri N. V. Vasudevanassessment Year : 2018-19 M/S. Suresh Electricals, Vs. Dcit, Ward No.25, Cmc T. S. No.227, Tilak Cpc, Nagar, Khb Colony, Bengaluru. Bellary – 583 101. Pan : Abyfs 9751 M Appellant Respondent Assessee By : Shri. B. S. Balachandran, Advocate Revenue By : Shri. Ganesh R. Ghale, Standing Counsel Date Of Hearing : 23.11.2022 Date Of Pronouncement : 24.11.2022 O R D E R This Is An Appeal By The Assessee Directed Against The Order Of Nfac, Delhi, Dated 12.07.2022, Relating To Assessment Year 2018-19. 2. The Only Issue That Arises For Consideration In This Appeal Is As To Whether The Revenue Authorities Were Justified In Disallowing Payment Made To Esi/Pf Being Employees’ Share Of Contribution Under Section 36(1)(Va) Of The Income Tax Act, 1961 (Hereinafter Called ‘The Act’). 3. In This Regard, It Is Pertinent To Note That The Employee Provident Fund & Miscellaneous Provisions Act, 1952 Was Promulgated To Provide For Such Institution Of Provident Funds, Pension Fund & Deposit-Linked Insurance Fund For Employees In Factories & Other Establishments. It Aims To Build Adequate Retirement Corpus For The Salaried Class Of Employees. The Fund Includes Contributions From The Employer & Employee Both, Page 2 Of 14

For Appellant: Shri. B. S. Balachandran, AdvocateFor Respondent: Shri. Ganesh R. Ghale, Standing Counsel
Section 2Section 2(24)(x)Section 36(1)(va)

…e following judicial pronouncement wherein the aforesaid distinction has been accepted viz., CIT v. Gujarat State Road Transport Corpn. [2014] 41 taxmann.com 100/ 366 ITR 170/223 Taxman 398 (Guj.), CIT v. Merchant Ltd. [2015] 61 taxmann.com 119/235 Taxman 291/378 ITR 443 (Ker.). 13. Some judicial pronouncements are to the effect that employees contribution paid belatedly but within due date prescribed u/s.139(1) of the Act should be allowed as deduction on payment basis u/s 43B at par with employers' contribution to PF/ESI. The following are such judicial pronouncements; CIT vs. Aimil Ltd. [2010] 188 Taxman 265/3…

BHORUKA FABCONS PRIVATE LIMITED,MYSURU vs. THE ASSISTANT DIRECTOR OF INCOME TAX, CPC, BANGALORE

In the result, appeal of the assessee is dismissed

ITA 910/BANG/2022[2020-21]Status: DisposedITAT Bangalore24 Nov 2022AY 2020-21

Bench: Shri N. V. Vasudevanassessment Year : 2020-21 M/S. Bhoruka Fabcons Pvt. Ltd., Vs. The Assistant Director Of Income Tax, No.427E, Hebbal Industrial Area, Cpc, Mysuru – 570 016. Bengaluru. Pan : Aaccb 9377 N Appellant Respondent Assessee By : Shri. Bhargava S. N, Ca Revenue By : Shri. Ganesh R. Ghale, Standing Counsel Date Of Hearing : 23.11.2022 Date Of Pronouncement : 24.11.2022 O R D E R This Is An Appeal By The Assessee Directed Against The Order Of Nfac, Delhi, Dated 28.07.2022, Relating To Assessment Year 2020-21. 2. The Only Issue That Arises For Consideration In This Appeal Is As To Whether The Revenue Authorities Were Justified In Disallowing Payment Made To Esi/Pf Being Employees’ Share Of Contribution Under Section 36(1)(Va) Of The Income Tax Act, 1961 (Hereinafter Called ‘The Act’). 3. In This Regard, It Is Pertinent To Note That The Employee Provident Fund & Miscellaneous Provisions Act, 1952 Was Promulgated To Provide For Such Institution Of Provident Funds, Pension Fund & Deposit-Linked Insurance Fund For Employees In Factories & Other Establishments. It Aims To Build Adequate Retirement Corpus For The Salaried Class Of Employees. The Fund Includes Contributions From The Employer & Employee Both, Calculated In The Prescribed Manner Under The Relevant Act. As Per Page 2 Of 13

For Appellant: Shri. Bhargava S. N, CAFor Respondent: Shri. Ganesh R. Ghale, Standing Counsel
Section 2Section 2(24)(x)Section 36(1)(va)

…e following judicial pronouncement wherein the aforesaid distinction has been accepted viz., CIT v. Gujarat State Road Transport Corpn. [2014] 41 taxmann.com 100/ 366 ITR 170/223 Taxman 398 (Guj.), CIT v. Merchant Ltd. [2015] 61 taxmann.com 119/235 Taxman 291/378 ITR 443 (Ker.). 13. Some judicial pronouncements are to the effect that employees contribution paid belatedly but within due date prescribed u/s.139(1) of the Act should be allowed as deduction on payment basis u/s 43B at par with employers' contribution to PF/ESI. The following are such judicial pronouncements; CIT vs. Aimil Ltd. [2010] 188 Taxman 265/3…

CHASE SECURITY,BANGALORE vs. INCOME TAX OFFICER, WARD-6(3)(1), BANGALORE

In the result, appeal of the assessee is dismissed

ITA 796/BANG/2022[2018-19]Status: DisposedITAT Bangalore23 Nov 2022AY 2018-19

Bench: Shri N. V. Vasudevanassessment Year : 2018-19 M/S. Chase Security, Vs. The Ito, No.16/A, 1St Floor, Millar Tank Bund Ward – 6(3)(1), Cpc, Road, Vasanth Nagar, Bengaluru. Bengaluru – 560 052. Pan : Aaefc 2412 L Appellant Respondent Assessee By : Smt. Sheethal Borkar, Advocate Revenue By : Shri. Ganesh R. Ghale, Standing Counsel Date Of Hearing : 21.11.2022 Date Of Pronouncement : 23.11.2022 O R D E R This Is An Appeal By The Assessee Directed Against The Order Dated 29.04.2021 By The Nfac, Delhi Relating To Assessment Year 2018-19. 2. The Only Issue That Arises For Consideration In This Appeal Is As To Whether The Revenue Authorities Were Justified In Disallowing Payment Made To Esi/Pf Being Employees’ Share Of Contribution Under Section 36(1)(Va) Of The Income Tax Act, 1961 (Hereinafter Called ‘The Act’). 3. In This Regard, It Is Pertinent To Note That The Employee Provident Fund & Miscellaneous Provisions Act, 1952 Was Promulgated To Provide For Such Institution Of Provident Funds, Pension Fund & Deposit-Linked Insurance Fund For Employees In Factories & Other Establishments. It Aims To Build Adequate Retirement Corpus For The Salaried Class Of Employees. The Fund Includes Contributions From The Employer & Employee Both, Page 2 Of 14

For Appellant: Smt. Sheethal Borkar, AdvocateFor Respondent: Shri. Ganesh R. Ghale, Standing Counsel
Section 2Section 2(24)(x)Section 36(1)(va)

…e following judicial pronouncement wherein the aforesaid distinction has been accepted viz., CIT v. Gujarat State Road Transport Corpn. [2014] 41 taxmann.com 100/ 366 ITR 170/223 Taxman 398 (Guj.), CIT v. Merchant Ltd. [2015] 61 taxmann.com 119/235 Taxman 291/378 ITR 443 (Ker.). 13. Some judicial pronouncements are to the effect that employees contribution paid belatedly but within due date prescribed u/s.139(1) of the Act should be allowed as deduction on payment basis u/s 43B at par with employers' contribution to PF/ESI. The following are such judicial pronouncements; CIT vs. Aimil Ltd. [2010] 188 Taxman 265/3…

INDORE BIOTECH INPUTS & RESEARCH P LTD ,INDORE vs. DCIT-CPC BANGLORE, BANGLORE

In the result, these appeals are allowed

ITA 115/IND/2022[2018-19]Status: HeardITAT Indore12 Oct 2022AY 2018-19

Bench: Shri T.R. Senthil Kumar & Shri B.M. Biyani(Conducted Through Virtual Court) Indore Biotech Input & Cpc, Bangalore Research Pvt. Ltd. Vs. Indore (Appellant / Assessee) (Respondent / Revenue) Pan: Aabcp 0235 A Assessee By Ms. Nisha Lahoti & Shri Vijay Bansal, Ars Revenue By Shri Ashish Porwal, Sr. Dr Shyam Sunder Trivedi Cpc, Bangalore Vs. Bhopal (Appellant / Assessee) (Respondent / Revenue) Pan: Actpt 3280 G Assessee By None Revenue By Shri Ashish Porwal, Sr. Dr Shri Pradeep Kumar Cpc, Bangalore Pariyani, Indore Vs. (Appellant / Assessee) (Respondent/ Revenue) Pan: Afkpp 3296 G Assessee By None Revenue By Shri Ashish Porwal, Sr. Dr

Section 139(1)Section 143(1)Section 143(1)(iv)Section 36(1)(va)Section 43B

…com 100 (b) Hon’ble Gujarat High Court in Pr. CIT vs. M/s Suzlon Energy Ltd. (2020) 115 taxmann.com 340 ITA No.115/Ind/2022 & others Indore Biotech Input and Research Pvt. Ltd. & others Page 4 of 7 (c) Hon’ble Kerala High Court in CIT Vs. Merchem Ltd. (2015) 378 ITR 443 7.1 Ld. DR further submitted that the Finance Act, 2021 has also inserted Explanation 2 to Section 36(1)(va) and Explanation 5 to Section 43B as under: Section 36(1)(va): “Explanation 2.—For the removal of doubts, it is hereby clarified that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purpo…

SHRI PRADEEP KUMAR PARIYANI,INDORE vs. CIT(A) NFAC, DELHI

In the result, these appeals are allowed

ITA 165/IND/2021[2019-20]Status: DisposedITAT Indore12 Oct 2022AY 2019-20

Bench: Shri T.R. Senthil Kumar & Shri B.M. Biyani(Conducted Through Virtual Court) Indore Biotech Input & Cpc, Bangalore Research Pvt. Ltd. Vs. Indore (Appellant / Assessee) (Respondent / Revenue) Pan: Aabcp 0235 A Assessee By Ms. Nisha Lahoti & Shri Vijay Bansal, Ars Revenue By Shri Ashish Porwal, Sr. Dr Shyam Sunder Trivedi Cpc, Bangalore Vs. Bhopal (Appellant / Assessee) (Respondent / Revenue) Pan: Actpt 3280 G Assessee By None Revenue By Shri Ashish Porwal, Sr. Dr Shri Pradeep Kumar Cpc, Bangalore Pariyani, Indore Vs. (Appellant / Assessee) (Respondent/ Revenue) Pan: Afkpp 3296 G Assessee By None Revenue By Shri Ashish Porwal, Sr. Dr

Section 139(1)Section 143(1)Section 143(1)(iv)Section 36(1)(va)Section 43B

…com 100 (b) Hon’ble Gujarat High Court in Pr. CIT vs. M/s Suzlon Energy Ltd. (2020) 115 taxmann.com 340 ITA No.115/Ind/2022 & others Indore Biotech Input and Research Pvt. Ltd. & others Page 4 of 7 (c) Hon’ble Kerala High Court in CIT Vs. Merchem Ltd. (2015) 378 ITR 443 7.1 Ld. DR further submitted that the Finance Act, 2021 has also inserted Explanation 2 to Section 36(1)(va) and Explanation 5 to Section 43B as under: Section 36(1)(va): “Explanation 2.—For the removal of doubts, it is hereby clarified that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purpo…

SH. AMRIK SINGH GAREWAL,CHANDIGARH vs. DCIT, CIRCLE -1, CHANDIGARH

In the result, both the appeals of the assessees are allowed

ITA 543/CHANDI/2022[2018-19]Status: DisposedITAT Chandigarh28 Sept 2022AY 2018-19

Bench: Shri A.D. Jainआयकर अपील सं./ Ita No. 543/Chd/2022 "नधा"रणवष" / Assessment Year : 2018-19 Sh. Amrik Singh Garewal, Dcit, Cpc, Bangluru बनाम 223-224, Ind Area Phasae-1, Current Jao, Dcit, Chandigarh 160028 Circle-1,Chandigarh

For Appellant: Sh. None (submissions of Sh. Neeraj Jain)For Respondent: Smt. Priyanka Dhar, Sr. DR
Section 139(1)Section 143(1)Section 36(1)(va)Section 43B

…d to be applicable only with prospective effect from 1.4.2021, I hold that the impugned disallowance is not sustainable in view of all these latest developments even if the Revenue’s case is supported by the following case law. (i) CIT vs. Merchem Ltd, [2015] 378 ITR 443(Ker) (ii) CIT vs. Gujarat State Road Transport Corporation (2014) 366 ITR 170 (Guj.) (iii) CIT vs. South India Corporation Ltd. (2000) 242 ITR 114 (Ker) (iv) CIT vs. GTN Textiles Ltd. (2004) 269 ITR 282 (Ker) (v) CIT vs. Jairam& Sons [2004] 269 ITR 285 (Ker) The impugned ESI/PF disallowance is directed to be deleted therefore.” 10. On an ident…

M/S BASANT MECHANICAL WORKS,LUDHIANA vs. JCIT, CIRCLE IV, LUDHIANA

In the result, both the appeals of the assessees are allowed

ITA 541/CHANDI/2022[2017-18]Status: DisposedITAT Chandigarh28 Sept 2022AY 2017-18

Bench: Shri A.D. Jainआयकर अपील सं./ Ita No. 541/Chd/2022 "नधा"रणवष" / Assessment Year : 2017-18 M/S Basant Mechanical Works, 1. Dcit, Cpc, बनाम 720-21, Ind. Area-B, Banglore Ludhiana, Punjab 2. Jurisdiction Ao- 141003 Jcit, Circle Iv, Ludhiana "थायी लेखा सं./Pan No: Aabfb0687M अपीलाथ"/Appellant ""यथ"/Respondent

For Appellant: Sh. Rohit Kaura, AdvocateFor Respondent: Smt. Priyanka Dhar, Sr. DR
Section 139(1)Section 143(1)Section 36(1)(va)Section 43B

…d to be applicable only with prospective effect from 1.4.2021, I hold that the impugned disallowance is not sustainable in view of all these latest developments even if the Revenue’s case is supported by the following case law. (i) CIT vs. Merchem Ltd, [2015] 378 ITR 443(Ker) (ii) CIT vs. Gujarat State Road Transport Corporation (2014) 366 ITR 170 (Guj.) (iii) CIT vs. South India Corporation Ltd. (2000) 242 ITR 114 (Ker) (iv) CIT vs. GTN Textiles Ltd. (2004) 269 ITR 282 (Ker) (v) CIT vs. Jairam& Sons [2004] 269 ITR 285 (Ker) The impugned ESI/PF disallowance is directed to be deleted therefore.” 10. On an ident…

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