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2022 (3) TMI 1128 - AT - Income TaxBelated remittance of employees share of ESIC and PF u/s. 43B r.w.s. 36(1) - Assessee submitted that payment made within due date of filing the return of income u/s 139(1) of the Act for the year under consideration - HELD THAT - As decided in the case of M/s. Jana Urban Services For Transformation Pvt. Ltd. 2021 (10) TMI 842 - ITAT BANGALORE no merit in the argument of the ld. DR since the explanation as provided in Finance Act 2021 prescribes that the amendment in both sec.36(va) as well as 43B by inserting corresponding explanation that although impugned PF comes in the form of provision and the same is applicable from 1/4/2021 onwards only. In the present case we are concerned with the asst. year 2017-18 and the amended provision could not be applied retrospectively as it is only applicable w.e.f 1/4/2021. Being so no disallowance could be made by the AO in respect of PF/ESI paid within the due date of filing return of income. Though, it was beyond the date mentioned in the respective Act. - Decided in favour of assessee.
Issues involved:
1. Addition of ?3,35,951 towards belated remittance of employees' share of ESIC and PF under section 43B r.w.s. 36(1)(va) of the Income-tax Act. Detailed Analysis: The appeal was against the order of the CIT(Appeals) regarding the addition of ?3,35,951 for belated remittance of employees' share of ESIC and PF. The assessee contended that the payments were made before the due date of filing the return of income u/s. 139(1) and should be allowable under section 43B of the Act. The Tribunal referred to a similar case where it was held that if the payment is made before the due date of filing the return of income, it cannot be disallowed under section 36(1)(va) of the Act (Para 6). The Tribunal also cited a judgment by the Hon'ble Karnataka High Court, emphasizing that the deduction for payment of tax under section 139 of the Act can be claimed if the payment is made on or before the due date applicable for submitting returns of income (Para 8). Furthermore, the Tribunal referred to various judgments supporting the view that the Employees' Contribution should not be covered by section 43B, especially considering the explanatory notes in the Finance Act 2021. The Tribunal concluded that the amended provision could not be applied retrospectively and no disallowance could be made by the AO for PF/ESI payments made within the due date of filing the return of income (Para 12). In conclusion, the Tribunal allowed the appeal of the assessee based on the above analysis and judgments referred to, stating that no disallowance could be made for PF/ESI payments made within the due date of filing the return of income, even if they were beyond the date mentioned in the respective Act (Para 12). Therefore, the appeal by the assessee was allowed based on the detailed analysis and legal interpretations provided by the Tribunal, following the principles established in the cited judgments and relevant provisions of the Income-tax Act.
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