2024 (7) TMI 28 - AT - Income Tax

Delayed payment of Provident Fund ( PF ) and Employees State Insurance ( ESI ) - Addition invoking section 36(1)(va) r.w.s. 2(24)(x) and 43B - HELD THAT - AO is directed to verify the contentions of the assessee and if the employer s contribution has been deposited before the due date of filing of return of income as per the provisions of section 43B read with section 36 of the Act, the Assessing Officer will allow the same accordingly. So far as the delayed deposit of employees contribution to PF/ESI is concerned, the ld. Counsel has not pressed the issue in view of the decision of the Hon ble Supreme Court in Checkmate Services Pvt. Ltd 2022 (10) TMI 617 - SUPREME COURT wherein, it has been held that deduction u/s 36(1)(va) in respect of delayed deposit of amount collected towards employees contribution to PF cannot be claimed even though deposited within the due date of filing of return even when read with Section 43B of the Income-tax Act, 1961. Appeal of the assessee is treated as partly allowed for statistical purposes.

Summary

The appeal was filed against the order of the National Faceless Appeal Centre under the Income Tax Act. The issue was the disallowance of Rs. 85,23,450 for delayed PF and ESI deposits. The employer's contribution was allowed as deduction, but the employees' contribution was disallowed. The appeal was partly allowed based on the Supreme Court decision in 'Checkmate Services Pvt. Ltd. Vs. CIT'.