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TMI Blog2023 (6) TMI 1412X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of Section 36(1)(va) and has held that in case employee contribution of PF/ESI deducted by employer is deposited late beyond the time prescribed under the relevant statute governing PF/ESI, no deduction shall be allowed keeping in view provisions of Section 36(1)(va) of the 1961 Act. It will be relevant at this point of time to refer to decision of ITAT, Chennai Bench, in the case of M/s Electrical India [ 2022 (11) TMI 1363 - ITAT CHENNAI] wherein this issue is decided in favour of Revenue. Thus, this appeal filed by the assessee lacks merit and stand dismissed. We order accordingly. - SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER For the Assessee :Sh. R.K.N. Jaiswal, Advocate For the Revenue :Sh. A.K. Singh, Sr. DR ORDER PER SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER: This appeal, filed by assessee, arising out of the appellate order, dated 23.12.2022 passed by the learned CIT(A), National Faceless Appeal Centre, Delhi (DIN Order No. ITBA/NFAC/S/250/2022-23/1048192998(1)) in Appeal No. CIT(A), Varanasi/10002/2020-21, for assessment year 2019-20, which in turn has arisen out of the intimation dated 29.02.2020 passed u/s 143(1) by CPC, Benga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated 12.10.2022), reported in (2022) 143 taxmann.com 178(SC) . 5. Aggrieved by the appellate order passed by ld. CIT(A), the assessee filed second appeal with tribunal. The learned counsel for the assessee submitted that the additions are being made of Rs. 1,28,680/- for delayed deposit of EPF / ESI beyond the time stipulated under section 36(1)(va) r.w.s. 2(24)(x) of the Act. The ld. Counsel for the assessee submitted that processing of return of income was done by CPC , Bengaluru under section 143(1). The ld. Counsel for the assessee drew our attention to provisions of Section 14 of the Income Tax Act,1961 which defines various heads of income under which income is chargeable to tax. The ld. Counsel for the assessee also drew our attention to provisions of Section 2(24)(x) and 28 of the Act , and it was submitted that section 2(24)(x) of the Act is not covered by section 28 , and the said employee contribution which is recovered by the employer is not covered under section 28 and it is not an income from Business or Profession under section 28. He drew our attention to section 36(1)(va) of the Act. The ld. Counsel for the asses submitted that this income cannot be brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... beyond the date prescribed under the relevant statute governing PF/ESI. It was submitted that it is covered under section 43B and hence the addition should be allowed. 4b. The learned Sr. DR, on the other hand submitted that the employees contribution of EPF / ESI is deemed as an income under 2(24)(x) of the Act irrespective of the head of the income. Section 56 refers to income chargeable as income from other sources. It is applicable to such as entity like school, college, Trust etc. where PF / ESI is applicable , but the income is not chargeable to tax under the head income from Profit and gain from business or profession and such type of enterprises are covered under section 56 which are not business enterprises, and the income is chargeable to tax under the head Income from other sources . Reference is drawn by ld. Sr. DR to provisions of section 57(ia) of the Act, and it was submitted that provisions of Section 36(1)(va) is referred to in Section 57(ia) and deduction shall be allowed only when the employee contribution towards PF/ESI are deposited within the due date as prescribed under the relevant statute. Section 2(24)(x) creates a deeming fiction wherein employee contrib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to treat employee contribution received by employer which shall be deemed as income of the assessee. There is no restriction imposed by this section 2(24)(x) as to the head of income under which it will fall for being taxed. Section 14 provides head of income , wherein the income shall fall for being taxed depending upon nature of income such as Salaries, Rent, Business/ Professional Income , Capital gains so and so forth. The assessee in the instant case is engaged in the business and has employed employees/ workers to whom salaries/wages are paid who are rendering their services in connection with the business activities of the assessee. The income earned by the assessee is from business which falls under the head Profits and Gains of Business or Profession and shall be chargeable to tax under Chapter IV-D of the 1961 Act. Section 28 is relevant , wherein this deemed income u/s 2(24)(x) shall fall to be taxed u/s 28(i) of the 1961 Act keeping in view deeming fiction created by Section 2(24)(x). Chapter IV-D further provides for deduction u/s 36(1)(va) for depositing such employee contribution deducted by employer with the relevant fund concerning PF and ESI, within the stipulat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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