Employees' GPF, GIS, PF Payments Post Due Date Deductible Under Section 43B

The Tribunal dismissed the Revenue's appeal regarding the disallowance of employees' contribution in GPF, GIS, and PF payments, confirming that such payments made after the due date but before filing the return are deductible under section 43B. The Tribunal aligned with the High Court's judgment and upheld the CIT(A)'s decision, ultimately denying the Revenue's appeal.

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Issues involved: The judgment deals with the disallowance of payment of employees' contribution in respect of GPF, GIS, and PF in sugar units and distillery units under section 2(24)(x) read with section 36(1)(va) of the Income Tax Act.

Details of the Judgment:

1. The appeal was filed by the Revenue against the order of CIT(A) on the grounds that the provisions of section 43B of the Act are not applicable to the amount deposited by employees as their contribution to PF. The appeal proceeded in the absence of the assessee, and the Revenue was heard.

2. The issue revolved around the disallowance of payment of employees' contribution amounting to &8377;23,65,450, which was paid beyond the prescribed time. The Assessing Officer added this amount to the income of the assessee. The CIT(A) re-examined the issue and concluded that due to the omission of the second proviso to section 43B of the Act, no disallowance was warranted for payments mentioned in section 36(1)(va). The CIT(A) also noted that the amount was deposited before the due date of filing the income tax return, precluding disallowance under section 43B.

3. The Revenue, aggrieved by the CIT(A)'s decision, appealed before the Tribunal, relying on the assessment order.

4. The Tribunal, after considering the relevant provisions of the Act and referring to a previous judgment, CIT vs. Manoj Kumar Singh, held that payments of employees' contribution to GPF, GIS, and PF, if made after the due date but before filing the return, are deductible under section 43B. As the CIT(A)'s order aligned with the jurisdictional High Court's judgment, the Tribunal found no fault in it and confirmed the decision.

5. Consequently, the Tribunal dismissed the Revenue's appeal.

(Order pronounced in the open court on 25/04/2013)

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