Appellate authority upholds deduction for late contributions, citing compliance within grace period. Assessing Officer exceeded jurisdiction.

The appellate authority upheld the deletion of disallowances under various sections for late payments of contributions by the assessee, citing compliance within the grace period allowed by relevant Acts. The court emphasized that payments made within the grace period were deductible, dismissing the Revenue's challenges and affirming that the Assessing Officer exceeded jurisdiction in changing the orders. The due date interpretation encompassing the grace period was supported, leading to the dismissal of the appeal as no substantial legal question arose from the ITAT's decision.

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Issues:
1. Disallowance under section 43(B) for ESI contribution not deposited by the assessee.
2. Disallowance under section 2(24)(x) and section 36(1)(va) for late payment of employees' provident fund contribution.
3. Disallowance under second proviso to section 43B and section 36(1)(iv) for late payment of employer's contribution.
4. Interpretation of due date under Explanation to section 36(1)(va) including grace period.

Issue 1: Disallowance under section 43(B) for ESI contribution not deposited by the assessee:
The Revenue challenged the order of the ITAT confirming the deletion of disallowance made under section 43(B) for ESI contributions not deposited by the assessee. The CIT(A) deleted the disallowance based on the argument that all payments were made within the grace period allowed by relevant statutory Acts. The appellate authority cited relevant case law supporting the deductibility of payments made within the grace period, leading to the deletion of the disallowance.

Issue 2: Disallowance under section 2(24)(x) and section 36(1)(va) for late payment of employees' provident fund contribution:
The Revenue contested the deletion of disallowance under section 2(24)(x) and section 36(1)(va) for late payment of employees' provident fund contribution. The CIT(A) ruled in favor of the assessee, stating that all payments were made within the grace period provided under the relevant Acts. The ITAT dismissed the Revenue's appeal, emphasizing that the payments were within the grace period, hence the addition by the Assessing Officer was unwarranted.

Issue 3: Disallowance under second proviso to section 43B and section 36(1)(iv) for late payment of employer's contribution:
The Revenue challenged the deletion of disallowance made by the Assessing Officer under the second proviso to section 43B and section 36(1)(iv) for late payment of employer's contribution. The CIT(A) and ITAT upheld the deletion, citing that the payments were made within the grace period allowed by the circular issued under the PF Act. The ITAT dismissed the appeal, stating that the Assessing Officer exceeded jurisdiction in changing the order on merits.

Issue 4: Interpretation of due date under Explanation to section 36(1)(va) including grace period:
The ITAT observed that the due date as defined in the Explanation to section 36(1)(va) includes the grace period, as allowed under the PF & ESI Acts. The Court concluded that the Assessing Officer overstepped jurisdiction by changing the order on merits under section 154 of the Act, emphasizing that the provident fund amount was deposited within the grace period. Consequently, the appeal was dismissed as no substantial question of law arose from the ITAT's order.

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