EMPLOYEES CONTRIBUTIONS OF PF/ESIC- UNNECESSARY LITIGATION BY REVENUE

[gvenugopal g]

Dear Experts,

This has reference from recent Article by CA Dev kumar Kothari Ji,

1) Kindly let us know whether contribution of PF/ESI is paid after the due date under the respective acts but before filing of return of income u/s 139(1), not to be disallowed both u/s 43B and 36(1)(va). And whether the due date for filing ITR is 30-09-2019 or extended due date i.e. 31-10.2019?

2) If the amount is disallowed (delay in 3 to 4 days as per due date of EPF/ESI Act) when ITR processed at CPC level or at local ITO level, kindly advice what is the solution.

[Shyam Naik]

There are many case laws, where delayed payment of PF & ESI but before due date of filing of return has been allowed by High Courts.

The action be department in this regards is unlawful and harsh.

AI Summary

PF and ESI contribution timeliness: belated payments made before filing the return may not be disallowed under tax deduction rules. Whether employer PF and ESI contributions paid after the statutory social-security due date but before filing the income-tax return are deductible and not disallowable under the tax provisions is contested; several judicial decisions have allowed such delayed payments and regarded departmental disallowance as unlawful and harsh, informing taxpayer responses when CPC or local officers propose adjustments.