Assessee's Appeal Granted for Statutory Delay in PF/ESI Payments.

The Tribunal allowed the appeal of the assessee for statistical purposes, directing the Assessing Officer to determine the delay in payment of Employees' Contribution to PF/ESI based on previous legal precedents. The Tribunal emphasized that relief, if found admissible, would be granted accordingly, highlighting the importance of following the High Court's binding judgment on the matter.

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Issues:
Challenge to correctness of order dated 31st July, 2017 passed by CIT(A)-1, Ahmedabad regarding assessment under section 143(3) of the Income-tax Act, 1961 for the assessment year 2014-15.

Analysis:
The appellant challenged the addition of &8377; 37,53,060/- for late payment of Employees Contribution to PF/ESI. The issue was that the CIT(A) confirmed this addition made by the Assessing Officer under Section 36(1)(va) r.w.s. 2(24)(x) of the Income-tax Act, 1961. Even though no one appeared on behalf of the assessee during the hearing, the Tribunal found that the matter was decisively settled by the jurisdictional High Court's judgment in the case of CIT vs. Gujarat State Road Transport Corporation. The High Court held that delayed deposit of employees' contribution to PF is not deductible in computing income under section 28 of the Act. The Tribunal emphasized that this legal precedent is binding, irrespective of any pending appeal before the Supreme Court. The dismissal of SLP by the Supreme Court in another case was also cited to clarify the non-binding nature of such dismissals. The Tribunal dismissed the appellant's grievance based on the binding judgment of the High Court.

The Tribunal referred to a previous case where a similar issue was addressed by a co-ordinate bench. In that case, it was noted that the relevant date for determining late payment of employees' contribution to PF/ESI is the month of actual payment of wages/salaries, not the month of salary. Based on this interpretation, the Tribunal directed the Assessing Officer to delete the disallowance of the impugned amount. The Tribunal highlighted that while delayed deposits of PF/ESI are generally disallowed as per the High Court's judgment, the determination of delay should be made by the Assessing Officer based on the co-ordinate bench's observations. The appellant would receive relief if found admissible on this basis.

Therefore, the Tribunal allowed the appeal of the assessee for statistical purposes, emphasizing that any relief would be granted based on the determination of delay by the Assessing Officer in accordance with the legal precedents discussed.

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