9911796707
TMI Blog2023 (10) TMI 1425X X X X Extracts X X X X X X X X Extracts X X X X ..... ord, it is evident that the employees contributions to P.F. and E.S.I.C. were deposited after the due date prescribed under the relevant statute. Thus, in Checkmate Services Pvt. Ltd the grounds raised by the assessee are dismissed. - SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER For the Assessee : None For the Revenue : Shri Ram Krishna Kedia ORDER PER SANDEEP SINGH KARHAIL, J.M. The present appeal has been filed by the assessee challenging the impugned order dated 24/09/2021, passed under section 250 of the Income Tax Act, 1961 ( the Act ) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [ learned CIT(A) ], for the assessment year 2018-19. 2. The pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the respective funds and hence same is correctly not been disallowed while computing total income in the return of income; thus the AO shall be directed to delete the addition. (b) The CIT(A) erred in confirming disallowance of Rs. 19,57,906/- made by the AO out of employees contribution to PF ESIC to the extent not credited to the respective funds on or before the due date specified in the respective Acts. The Appellant submits that the payment of employees contribution to PF ESIC of Rs. 19,57,906/- is made during the year under consideration itself and/or before the due date of filing return of income and same shall be allowed as deduction u/s 43B r.w.s. 36(1)(va) of the Act. (c) The CIT(A) erred in not following the binding decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Checkmate Services Pvt. Ltd. (supra) held that the payment towards employees contribution to P.F. and E.S.I.C., after the due date prescribed under the relevant statute is not allowable as a deduction under section 36(1)(va) of the Act. The relevant findings of the Hon ble Supreme Court, in the aforesaid decision, are as under: 53. The distinction between an employer's 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 Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pply in the case of amounts which are held in trust, as it is in the case of employees' contributions- which are deducted from their income. They are not part of the assessee employer's income, nor are they heads of deduction per se in the form of statutory pay out. They are others' income, monies, only deemed to be income, with the object of ensuring that they are paid within the due date 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
