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TMI Blog2023 (3) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... ment towards employee s contribution to provident fund after the due date prescribed under the relevant statute is not allowable as deduction under section 36(1)(va). Decided against assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ,58,100. The said return was processed under section 143(1) of the Act vide intimation dated 26/12/2021, computing the total income of the assessee at Rs.465,34,00,840, after making an addition of Rs.6,30,42,740, on account of delayed payment towards employee's contribution to provident fund under section 36(1)(va) of the Act. 5. The learned CIT(A) vide impugned order dated 08/09/2022 dismissed the appeal filed by the assessee on this issue and held that if the employer fails to deposit the entire amount towards employees' contribution on account of provident fund with concerned department on or before the due date under the relevant statute, the assessee shall not be entitled for deduction to that extent. Being aggrieved, the assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contribution which is its primary liability under law - in terms of Section 36(1)(iv), and its liability to deposit amounts received by it or deducted by it (Section 36(1)(va)) is, thus crucial. The former forms part of the employers' income, and the later retains its character as an income (albeit deemed), by virtue of Section 2(24)(x) - unless the conditions spelt by Explanation to Section 36(1)(va) are satisfied i.e., depositing such amount received or deducted from the employee on or before the due date. In other words, there is a marked distinction between the nature and character of the two amounts - the employer's liability is to be paid out of its income whereas the second is deemed an income, by definition, since it is the deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e specified in the particular law. They have to be deposited in terms of such welfare enactments. It is upon deposit, in terms of those enactments and on or before the due dates mandated by such concerned law, that the amount which is otherwise retained, and deemed an income, is treated as a deduction. Thus, it is an essential condition for the deduction that such amounts are deposited on or before the due date. If such interpretation were to be adopted, the non-obstante clause under Section 43B or anything contained in that provision would not absolve the assessee from its liability to deposit the employee's contribution on or before the due date as a condition for deduction." 9. We find that, recently, in Nissan Enterprise Ltd. vs DCIT-C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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