2023 (10) TMI 779 - HC - Income Tax

Amount payable towards the provident fund and towards the ESI fell due on a National Holiday - HELD THAT - We had the occasion to deal with a similar question of law in PEPSICO INDIA HOLDING PVT. LTD. 2023 (10) TMI 666 - DELHI HIGH COURT held since date fell on a date which was a National Holiday, the deposit could have been made by the respondent/assessee only on the date which followed the National Holiday. Section 10 of the General Clauses Act would help the respondent / assessee to tide over the objections raised on behalf of the appellant/revenue. Decided in favour of assessee.

Summary

Issues involved:
The issue involved in this case is whether the Income Tax Appellate Tribunal misdirected itself on facts and in law regarding the deposit made towards provident fund and ESI falling due on a National Holiday and the subsequent deduction claimed.

Judgment Details:

Issue 1:
The main issue in this case was whether the deposit made towards the provident fund and ESI on a National Holiday was amenable to deduction. The Court framed the question of law as follows: Whether the Tribunal misdirected itself in failing to notice that the amounts payable towards provident fund and ESI fell due on a National Holiday and whether the subsequent deposit made on the following day was eligible for deduction.

In a previous case, the Court had dealt with a similar question of law and observed that since the due date fell on a National Holiday, the deposit could only be made on the following day. The Court noted that Section 10 of the General Clauses Act would support the assessee in such situations, allowing for the deposit to be made on the next working day following the holiday.

The Court ultimately ruled in favor of the appellant/assessee, stating that the deposit made following the National Holiday was eligible for deduction. As a result, the appeal was dismissed in favor of the appellant.

End of Judgment