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TMI Blog2022 (2) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... :- 14-2-2022 - Shri R.K. Panda, Accountant Member For the Assessee : Shri Ruchesh Sinha, Advocate For the Revenue : Shri Om Prakash, Sr. DR ORDER PER R.K. PANDA, AM: This appeal filed by the assessee is directed against the order dated 27th August, 2020 of the CIT(A)-2, New Delhi, relating to assessment year 2018-19. 2. The grounds of appeal raised by the assessee are as under:- 1. That the ld.CIT(A) has erred on facts and in law in upholding the order of the AO, passed under section 154 of the Income Tax Act, 1961. 2. That the Ld. CIT(A) has erred on facts and in law in upholding the addition of ₹ 23,55,432/- made by AO by invoking the provisions of Section 36(1)(va) of the Income Tax Act, 1961 3. That the Ld. CIT(A) has erred on facts and in law in ignoring the well-established judicial pronouncements including that of the jurisdictional High Court. 4. That the impugned appellate order is arbitrary, illegal, bad in law and the violation of rudimentary principle of contemporary jurisprudence. 5. That the appellant craves leave to add, amend, alter, vary and/or withdraw any or all the above grounds of appeal before or at the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction any sum received by the assessee from any of his employees to which the provisions of section 2(24)(x) will be allowed as deduction, if such sum is credited by the assessee to the employees account in the relevant fund or funds on or before the due date. Due Date here means the date by which the assessee is required as an employer to credit an employees contribution to the employees account in the relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise. The Act also allows certain deductions u/s 43B, on actual payment such that the sum which is actually paid by the assessee on or before the due date applicable in his case for furnishing the return of income under section 139(1) are also allowed as deduction. If any of the deposit is outside the due date mandated under the statute then that amount shall never be allowed as deduction under section 36(l)(va) even though it might have been deposited with a delay of just 1 day. There is no provision in the Act under which this amount can be allowed as deduction in any year thereafter. 4.1.2 The judicial decision:- In this c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed:- (i) M/s. Adama Solution P. Ltd. v. The Asst. Director of Income Tax. (ITAT, Delhi); (ii) M/s. Aroon Facilitation Management Services Pvt. Ltd. v. DCIT, CPC New Delhi. (ITAT, Delhi); (iii) Vansh Jain v. DCIT, CPC New Delhi (ITAT, Delhi); (iv) Commissioner of Income-tax v. AIMIL Ltd., (Delhi High Court); (v) Pr. Commissioner Of Income Tax-7 v. Pro Interactive Service (India) Pvt. Ltd. (Delhi High Court); (vi) Yogi Ji Technoequip (P.) Ltd. v. Deputy Commissioner of Income-tax CPC, Bengaluru, (ITAT, Delhi); (vii) DCIT Circle-7(1) v. Dee Development Engineers Ltd., (ITAT, Delhi). 6. The ld. DR, on the other hand, heavily relied on the order of the AO and the CIT(A). 7. I have heard the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. The only issue to be decided in the impugned appeal is regarding the allowability of late payment of employees contribution to PF and ESI after the due date prescribed under the respective Acts, but, paid on or before the due date of filing of the income-tax return/s 139(1) of the IT Act. I find, identical issue had come up before the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Exhibitions Pvt. Ltd., New Delhi vs., Addl. CIT, Special Range-4, New Delhi vide ITA.No.6941/Del./2017 order dated 03.08.2021 while allowing such belated deposit of employees' contribution to PF ESI as per the respective Act, but, paid before the due date of filing of the income tax return, deleted such disallowance by observing as under : 8. We have carefully considered contentions of the learned departmental representative and perused the orders of the lower authorities. The facts shows that the assessee has collected the sum of ₹ 12,16,260/- being employee's contribution under the provident fund and with respect to ESI laws. The above contribution was admittedly not deposited by the assessee within the due date prescribed under the respective ESI and PF statue however, same was deposited before the due date of filing of return of income. Therefore, the ld AO as well as the ld CIT(A) disallowed the same holding that such contribution becomes the income of the assessee under the provision of section 2(24)(x) of the Act and thereafter if the same is deposit within the due date prescribed under the respective laws then same is allowable as deduction u/s 36(1)(v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clauses thereof for computing the income referred to in section 28 of the said Act. Clause (va) of the said sub-section provides for allowance of deduction for any sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 apply, if such sum is credited by the assessee to the employee's account in the relevant fund or funds on or before the due date. Explanation to the said clause provides that for the purposes of this clause, due date means the date by which the assessee is required as an employer to credit an employee's contribution to the employee's account in the relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise. It is proposed to insert Explanation 2 to clause (va) of sub-section (1) of the said section so as to clarify that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purposes of determining the due date under the said clause. This amendment will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment year 2021- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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