Debatable employee contribution disallowance cannot be made in summary processing under section 143(1)(a).

Disallowance of delayed employees' contribution to ESI and EPF could not be made in summary processing under section 143(1)(a) where the issue was debatable and subject to conflicting views. The adjustment under section 36(1)(va) required more than a prima facie examination, because section 143(1)(a) is limited to apparent arithmetical errors and other obvious adjustments, not questions that need substantive scrutiny under section 143(3). The disallowance was therefore held unsustainable and was deleted in favour of the assessee.

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Issues: Whether disallowance of employees' contribution towards ESI and EPF could be made in processing under section 143(1)(a) of the Income-tax Act, 1961 when the issue was debatable.

Analysis: The adjustment made in processing was based on disallowance of delayed deposit of employees' contribution under section 36(1)(va). The issue was already the subject of conflicting views and had not been settled at the time of the intimation order. Summary processing under section 143(1)(a) permits only apparent arithmetical errors and other prima facie adjustments, and does not authorize adjudication of a highly debatable question or a deeper examination that belongs to scrutiny assessment under section 143(3).

Conclusion: The disallowance made in section 143(1)(a) was not sustainable and was set aside in favour of the assessee.

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