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TMI Blog2023 (5) TMI 1370X X X X Extracts X X X X X X X X Extracts X X X X ..... CPC/AO and the actual amount deposited late - As perused the Form 3CD which shows an error in the amount mentioned in Form 3CD and actual disallowance made by the AO. The AO is directed to verify this fact and disallow the amount which was actually deposited on account of PF ESIC late as prescribed in the Act. Last date of depositing the employee s contribution of PF ESIC fell on Sunday - Perusal of the Circular No. 676 (supra) goes to show that when in case last day for payment of any installment of advance tax is day on which receiving bank is closed, assessee can make payment on next immediately following working day, and in such cases mandatory interest leviable under sections 234B and 234C would not be charged. Though this proposition is not directly applies to the issues at hand but when it is examined in the interest of justice it certainly favors the assessee. Applying the provisions contained u/s 10 of the General Clauses to the facts and circumstances of the case, we are of the considered view that payment made by the assessee on 16.07.2018 qua year under consideration is to be taken within time as there was no unjust enrichment of the assessee nor there was any malafide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT(A) by way of filing appeal who has confirmed the addition by dismissing the appeal. Feeling aggrieved with the impugned order passed by the Ld. CIT(A) the assessee has come up before the Tribunal by way filing the present appeal. 4. We have heard the Ld. Authorised Representatives of the parties to the appeal, perused the orders passed by the Ld. Lower Revenue Authorities and material available on record in the light of the facts and circumstances of the case and law applicable there to. 5. The Ld. A.R. for the assessee company challenging the impugned order passed by the Ld. CIT(A) contended that disallowing employees' contribution to PF ESIC while processing the return under section 143(1) is against the provision of the Act as it would not fall within the ambit of prima-facie adjustment, hence liable to be allowed and that when the issue in question is a debatable one view taken in favour of the assessee company is to be prevailed and relied upon plethora of orders passed by the Hon'ble High Court of Gujarat, Hon'ble High Court of Madras and CIT Vs. GVK Industries Ltd (2023) 147 taxmann.com 281 (Telegana HC). 6. However, on the other hand, the Ld. D.R. for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icated in the ruling in Alom Extrusions. As noticed previously. Alom Extrutions did not consider the fact of the introduction of Section 2(24)(x) or in fact the other provisions of the Act. 52. When Parliament introduced Section 43B, what was on the statute book, was only employer's contribution (Section 34(1)(iv)). At that point in time, there was no question of employee's contribution being considered as part of the employer's earning. On the application of the original principles of law it could have been treated only as receipts not amounting to income. When Parliament introduced the amendments in 1988-89, inserting Section 36(1)(va) and simultaneously inserting the second proviso of Section 43B, its intention was not to treat the disparate nature of the amounts, similarly. As discussed previously, the memorandum introducing the Finance Bill clearly stated that the provisions-especially second proviso to Section 43B - was introduced to ensure timely payments were made by the employer to the concerned fund (EPF, ESI, etc.) and avoid the mischief of employers retaining amounts for long periods. That Parliament intended to retain the separate character of these two amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 deduction from the employees' income and held in trust by the employer. This marked distinction has to be borne while interpreting the obligation of every assessee under Section 43B. 54. In the opinion of this Court, the reasoning in the impugned judgment that the non-obstante clause would not in any manner dilute or override the employer's obligation to deposit the amounts retained by it or deducted by it from the employee's income, unless the condition that it is deposited on or before the due date, is correct and justified. The non- obstante clause has to be understood in the context of the entire provision of Section 43B which is to ensure timely payment before the returns are filed, of certain liabilities which are to be borne by the assessee in the form of tax, interest payment and other statutory liability. In the case of these liabilities, what constitutes the due date is defined by the statute: Nevertheless, the assessees are given some leeway in that as long as deposits are made beyond the due date, but before the dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. A.R. for the assessee that it is a debatable issue is misconceived contention as the debate on the issue has already been set at rest. So since the assessee has failed to comply with the condition precedent for depositing the employees' contribution on account of PF ESIC before the due date prescribed under the Act the same has been rightly disallowed by the Ld. CIT(A). 12. Following the decision rendered by the Hon ble Supreme Court in case of Checkmate Services P. ltd Vs. CIT(supra), I am of the considered view that that this issue has rightly been decided against the assessee by the ld CIT(A) to the extent that the actual amount deposited by the assessee on account of employees contribution on account of PF ESI late as prescribed under the Act is to be disallowed. 13. However, the ld AR for the assessee contended that as per Form 3CD total payment deposited by the assessee on account of employee s contribution of PF ESIC late as prescribed under the relevant Act was Rs. 12,47,865/- whereas CPC/ AO has disallowed the amount of Rs. 13,21,554/- and brought on record Form 3CD as Annexure which is extracted, for ready perusal, as under:- 14. We have perused the Form 3CD which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding shall be considered as done or taken in due time after it is done or taken on the next day, afterwards, on which the Court or office (or the bank) is open. In view of this provision, it is hereby clarified that if the last day for payment of any instalments of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day, and in such cases, the mandatory interest leviable under sections 234B and 234C of the Income-tax Act, 1961 would not be charged. Circular : No. 676, dated 14-1-1994. Section 10 in The General Clauses Act, 1897 10 Computation of time. (1) Where, by any 19 [Central Act] or Regulation made after the commencement of this Act, any act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on which the Court or office is open: Provided that nothing in this section shall apply to any act or proceeding to wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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