PF and ESI employee contributions paid before return-filing due date were allowed as deduction under the Tribunal's view.

Employees' contribution to PF and ESI paid after the due dates under the welfare statutes but before the return-filing due date under section 139(1) was treated as deductible in this ITAT view, following its earlier interpretation that a payment made before the return deadline should not be denied deduction where the provision admits two possible readings. The Tribunal applied that construction to the facts and held the issue to be covered in favour of the assessee. The disallowance under section 36(1)(va) was deleted.

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Issues: Whether employees' contribution to PF and ESI, deposited after the due date under the respective welfare statutes but before the due date for filing the return under section 139(1), was liable to disallowance under section 36(1)(va).

Analysis: The payment of employees' contribution was admittedly made beyond the due date prescribed under the PF/ESI statutes, but it was made before the due date for filing the return of income. The Tribunal followed its earlier view, relying on the construction that the payment made before the return-filing due date cannot be denied deduction where two possible interpretations are available, and treated the issue as covered in favour of the assessee on similar facts.

Conclusion: The disallowance of employees' contribution to PF and ESI was deleted and the issue was decided in favour of the assessee.

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