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TMI Blog2023 (9) TMI 1650X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of the assessee and if these contributions are remitted before due date for filing of return of income the same be allowed as deduction. Employees contributions towards PF ESI - As noticed that similar issue came up for adjudication in the case of Bercos Melody House [ 2023 (9) TMI 1649 - ITAT DELHI] restore this issue to the file of the AO to decide the issue in the light of the observations made by the Tribunal in the case of Kanoi Paper Industries Ltd. [ 2001 (5) TMI 139 - ITAT CALCUTTA-E ] as held accrual of liability towards payment of salary without actual disbursement would not fasten obligation for deposits of employees contribution in the labour Acts per se . This aspect has not been found to be examined by the Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the assessee submits that the actual position in respect of the contributions towards PF ESI is as under: - S. No. Particulars Employee Share Employer Share Total 1. ESIC Contribution deposited before Due Date under ESIC Act. 2,06,175 5,58,104 7,64,279 2. ESIC Contribution deposited after Due Date under ESIC Act but before due date of filing return u/s 139(1). 9,87,571 26,75,030 36,62,601 3. ESIC Contribution deposited after Due date under ESIC Act and after due date of filing return u/s 139(1). 1,256 3,404 4,660 Total ESIC Contribution 11,95,002 32,36,538 44,31,540 4. PF Contribution deposited before Due date under PF Act. 7,50,205 4,46,679 11,96,884 5. PF Contribution deposited after Due date under PF Act but before due date of fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer. Therefore, we direct the AO to verify the contentions of the assessee and if these contributions are remitted before due date for filing of return of income the same be allowed as deduction. 6. Coming to employees contributions towards PF ESI we noticed that similar issue came up for adjudication in the case of Bercos Melody House Vs. DCIT in ITA Nos. 277 278/Del/2023 and the Tribunal by order dated 25.09.2023 held as under: - 4. Heard rival submissions. Identical issue came up before the coordinate bench in the case of Rekha Vs. ITO, ITA No. 584/Del/2020 dated 09.08.2023 and also in the case of Sentinel Consultants Pvt. Ltd. Vs. ACIT, ITA No. 7 8/Del/2023 dated 12.06.2023. The coordinate bench in the case of Sentinel Consult ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posit of employees contributions to PF/ESIC governed under Section 36(1)(va) is also simultaneously amenable to deduction under Section 37(1) of the Act. In terms of the provision, Section 37(1) permits deduction of expenditure which is not in the nature of expenditure prescribed in Sections 30 to 36 of the Act and also not being in the nature of capital expenditure or personal expenses of the assessee. Thus, in view of such mandate of law, the deduction of expenditure under the general clause of Section 37(1) would not extend to expenditure specially covered within the ambit of Section 36(1)(va) of the Act. The Hon ble Supreme Court in the case of Checkmate Pvt. Ltd. (supra) itself explains this position in Para 32 of the Judgment. Such vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Consultants Pvt. Ltd. and also the decision of the Kolkata Bench in the case of Kanoi Paper Industries Ltd. Vs. ACIT (supra). Needless to say that the Assessing Officer shall provide adequate opportunity of being heard to the assessee, the assessee is at liberty to provide all the necessary information in support of its contention. 7. Following the said order, we restore this issue to the file of the AO to decide the issue in the light of the observations made by the Tribunal in the case of Kanoi Paper Industries Ltd. Vs. ACIT (supra). Needless to say that the Assessing Officer shall provide adequate opportunity of being heard to the assessee, the assessee is at liberty to provide all the necessary information in support of its contention. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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