2025 (7) TMI 1731 - AT - Income Tax

ESI/EPF Contributions Must Be Paid by Due Date, Not Return Filing Date Under Section 139(1)

Sh. Kabir Dubey Versus Income Tax Office, Circle-5 (1) (1), G.B. Nagar

The ITAT Delhi upheld the principle from the SC in Checkmate Services Pvt Ltd that ESI/EPF contributions must be deposited by the statutory due date, not ... Disallowing ESI/EPF contribution - Delayed deposits - HELD THAT:- As noticed that the hon’ble apex court’s recent landmark decision in Checkmate Services Pvt Ltd [2022 (10) TMI 617 - SUPREME COURT (LB)] has already settled the issue in the department’s favour that the same ought to be deposited on or before the due date in the corresponding statute than that of filing of section 139(1) return. The assessee fails in it’s instant first and foremost ground in very terms. Assessee’s compliance to the foregoing statutory provision going by the actual date of salary disbursement, which has not been adjudicated by both the learned authorities. Thus deem it appropriate in the larger interest of justice to restore the assessee’s instant grievance to this limited extent to AO for his afresh appropriate factual verification subject to a rider that the assessee shall itself plead and prove at his own risk and responsibility that it had complied with the foregoing provision, going by the actual date of monthly salary disbursement in consequential proceedings. Ordered accordingly. The Appellate Tribunal (ITAT Delhi) heard the assessee's appeal for AY 2020-21 against the CIT(A)'s order under section 154 of the Income-tax Act, 1961. The primary issue concerned the disallowance of ESI/EPF contributions amounting to Rs. 15,57,375/-. Relying on the Supreme Court's ruling in Checkmate Services Pvt Ltd Vs. CIT [2022] 143 taxmann.com 278 (SC), the Tribunal affirmed the principle that such contributions must be deposited 'on or before the due date in the corresponding statute' rather than the due date for filing the return under section 139(1). Consequently, the assessee's first ground failed. However, the Tribunal identified a lacuna in the lower authorities' adjudication regarding the actual date of salary disbursement, which could affect compliance with the statutory deadline. Therefore, the matter was remanded to the Assessing Officer for fresh factual verification limited to this aspect, with the condition that the assessee must 'plead and prove at his own risk and responsibility' compliance based on the actual salary disbursement dates. The appeal was thus partly allowed for statistical purposes. The order was pronounced on 3rd June 2025.