Provident fund contribution deduction turns on statutory due date; delayed employee contributions were held not deductible under Checkmate Services.

Employees' contribution to provident fund is treated as income under section 2(24)(x) and is deductible only if credited within the due date under the welfare statute. Applying the Supreme Court ruling in Checkmate Services, delayed deposit beyond that statutory due date is not allowable under section 36(1)(va). The Tribunal further read section 38 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 as requiring deposit within fifteen days of the close of the month for which wages are payable, not from the wage payment date. It preferred the Gujarat and Madras High Court view and rejected the contrary single-judge view relied on by the assessee.

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Issues: Whether the delayed deposit of employees' contribution to provident fund was disallowable under section 36(1)(va) of the Income-tax Act, 1961, and whether the due date could be reckoned from the wage month rather than from the close of the month in which wages became due.

Analysis: Employees' contribution received by an employer falls within section 2(24)(x) of the Income-tax Act, 1961 and is allowable as a deduction only if credited to the relevant fund within the due date prescribed under the applicable welfare statute. In view of the binding Supreme Court ruling in Checkmate Services, delayed payment beyond the statutory due date is not deductible. On the alternative contention, the statutory scheme of section 38 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 was read to mean that the obligation to deposit arises within fifteen days of the close of the month for which wages are payable, and not with reference to the actual date of salary payment. The Tribunal also preferred the view taken by the Gujarat and Madras High Courts and declined to follow the contrary single-judge view relied on by the assessee.

Conclusion: The disallowance was upheld and the assessee's alternative computation based on the wage-payment cycle was rejected.

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