TaxTMI 
TaxTMI 
2022 (2) TMI 1145
X X X X Extracts X X X X
X X X X Extracts X X X X
....imation dated 12/03/2020 issued under section 143(1) processed by the ADIT, CPC, Bangalore on account of delay in deposit of employees contribution to PF & ESI without appreciating the fact that employees contribution to PF & ESI was duly deposited on or before the due date of filling return of income u/s 139(1). 2. That CIT(A)-NFAC, Delhi erred in confirming the addition of Rs. 11,45,054/- under the head income from business or profession in the intimation issued u/s.143(1) due to delay in deposit of employees contribution to PF and ESI under the relevant Acts but the same was duly deposited before the due date of filling return of income under section 139(1) of the I.T Act, 1961 without appreciating the fact that section 143(1)(a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Form No.3CD was silent regarding disallowance of employees contribution to PF and ESI when not deposited within the due dates given under the specific Acts , accordingly addition of Rs. 11,45,054/- confirmed by CIT(A)-NFAC, Delhi deserves to be deleted in full. 6. The above grounds of appeal are without prejudice to each other. The appellant may be allowed to add/amend/withdraw any grounds of appeal at the time of hearing or at any time before hearing with due permission of the Hon'ble Tribunal." 3. Facts giving rise to the present appeal are that Central Processing Centre ("CPC"), Bengaluru vide intimation u/s 143(1) of the Income Tax Act, 1961 ("the Act") for Assessment Year 2019-20 made adjustment regarding delay in depos....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d the Ld. Representatives of both the parties and perused the material available on record and gone through the orders of the authorities below. Ld.CIT(A) has decided the issue by observing as under:- 5. "I have carefully considered the order of the CPC, grounds of appeal, facts of the case and submission filed by the appellant. It is observed that the only issue involved is whether the late deposit of Employee's contribution of PF/ESI as per respective Act is allowable u/s 43B(b) being the payment deposited on or before the date of filing return u/s. 139(1) of the I.T. Act, 1961. As per the plain reading of provisions of the Act, Section- 2(24)(x) is applied to any sum received by the assessee from any of his employee....
X X X X Extracts X X X X
X X X X Extracts X X X X
....loyee's contribution towards welfare fund has been made through the insertion of this explanation in Section 43B. Now, the issue remains unanswered is the determination of due date for the deposit of employee contributions of PF/ESI which is well explained in Explanation 2 to sub clause (va) of clause 1 of Section 36 of the Act wherein it is clarified that for the purpose of determining the 'due date' under this clause the provisions of section 43B shall not apply and shall be deemed never to have been applied. Therefore, it is made clear that deposition of sum of employee contribution will be allowable as a deduction u/s 36(1)(va) if the same has been deposited within the due date as prescribed under respective Act. It....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... addition of Rs. 11,45,054/- is upheld. The appeal of the appellant is dismissed on this ground." 8. I find that the issue is covered by the judgement of Hon'ble Delhi High Court rendered in the case of AIMIL Ltd. (supra) wherein it has been held:- 17. "We may only add that if the employees' contribution is not deposited by the due date prescribed under the relevant Acts and is deposited late, the employer not only pays interest on delayed payment but can incur penalties also, for which specific provisions are made in the Provident Fund Act as well as the ESI Act. Therefore, the Act permits the employer to make the deposit with some delays, subject to the aforesaid consequences. Insofar as the Income Tax Act is concerned, the as....