Tribunal allows appeals, deletes disallowance for delayed ESI/PF deposits.

The Tribunal allowed both appeals of the Assessee, directing the deletion of the disallowance u/s 36(1)(va) for delayed ESI/PF deposits for Assessment Years 2017-18 & 2018-19. The Tribunal emphasized the legislative intent to allow expenditure only upon actual payment and found no stay or overruling of the relevant Tribunal decision by a higher forum. The order was pronounced in favor of the Assessee on 29.10.2021.

---

---

Issues Involved:
Appeals against disallowance u/s 36(1)(va) of the Act for delayed deposit of ESI/PF dues for Assessment Years 2017-18 & 2018-19.

Analysis:

1. Identical Issues in Both Appeals:
- The appeals were against the order of the Commissioner of Income Tax (Appeals) relating to Assessment Years 2017-18 & 2018-19.
- The issue involved in both appeals was identical, except for the year and amounts involved.
- The Counsel argued that submissions made for one year would be applicable to the other year as well.

2. Disallowance u/s 36(1)(va) for Delayed Deposits:
- The Assessee, a company, filed its return for A.Y. 2017-18, with the CPC determining total income after disallowing an amount for delayed ESI/PF deposit.
- The CIT(A) upheld the disallowance, citing a High Court decision and rejected the Assessee's contention of depositing dues before filing the return.
- The Assessee appealed, arguing that the amount was deposited before filing the return, and relied on a Tribunal decision in a similar case.
- The Tribunal, after considering relevant judgments, held that no disallowance was warranted as the dues were deposited before filing the return.

3. Decision and Rationale:
- The Tribunal referred to a case where the High Court decided in favor of the Assessee, emphasizing that the legislative intent was to allow expenditure only upon actual payment.
- The Tribunal found no stay or overruling of the relevant Tribunal decision by a higher forum and allowed the Assessee's appeal for both years.
- Both parties agreed that the issue in the appeal for A.Y. 2018-19 was identical to that of A.Y. 2017-18, and the Tribunal allowed the appeal for both years based on similar reasons.

4. Final Verdict:
- The Tribunal allowed both appeals of the Assessee, directing the deletion of the disallowance u/s 36(1)(va) for delayed ESI/PF deposits for both Assessment Years.
- The order was pronounced in the open court on 29.10.2021, in favor of the Assessee.

This detailed analysis highlights the legal arguments, precedents cited, and the Tribunal's rationale in allowing the appeals against the disallowance of ESI/PF dues for delayed deposits.

---