AI Drafter 
TaxTMI 
TaxTMI 
2022 (12) TMI 924
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....d to as the Act) by DCIT, Circle-10, Kolkata, dated 23.01.2014. 2. At the outset, registry has pointed out that there is a delay of 1612 days in filing the present appeal before the Tribunal. A petition for condonation of delay in filing the appeal is placed on record dated 06.03.2021. The order of Ld. CIT(A) is dated 11.08.2016 and the limitation to file the present appeal expired on 07.10.2016. The reasons given for the condonation of delay in filing the appeal are that assessee had filed application u/s. 154 of the Act for rectification of order passed by Ld. CIT(A) and did not pursue the matter to file the appeal before the Tribunal for want of disposal of pending rectification application. The impugned order of Ld. CIT(A) has not ye....
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....pted by the assessee in filing the instant appeal, however, without laying down any precedence and by taking the justice oriented approach, we condone the delay of 1612 days in filing the appeal before the Tribunal and admit it for adjudication. 3. At the outset, we note that the grounds of appeal relate to disallowance made u/s. 36(1)(va) of the Act in respect of delay in deposit of Employees' Contribution of Provident Fund and Employees State Insurance (PF & ESI) totalling to Rs.17,86,781/-. The issue relating to grounds taken by the assessee have come to rest by the recent verdict of the Hon'ble Supreme Court in Chekmate Services Pvt. Ltd. Vs. CIT (2022) 143 taxmann.com 178 (SC) dated 12.10.2022 wherein it has been held that "deductio....
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....s had to be deposited by the employer, with the EPF/ESI, on or before the due date. The last expression "due date" was dealt with in the explanation as the date by which such amounts had to be credited by the employer, in the concerned enactments such as EPF/ESI Acts. Importantly, such a condition (i.e., depositing the amount on or before the due date) has not been enacted in relation to the employer's contribution (i.e., Section 36(1)(iv)). • The significance of this is that Parliament treated contributions under Section 36(1)(va) differently from those under Section 36(1)(iv). The latter (hereinafter, "employers' contribution") is described as "sum paid by the assessee as an employer by way of contribution towards a r....
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....was available. A reading of the judgment in Alom Extrusions, would reveal that this court, did not consider Sections 2(24)(x) and 36(1)(va). Furthermore, the separate provisions in Section 36(1) for employers' contribution and employees' contribution, too went unnoticed. • When Parliament introduced Section 43B, what was on the statute book, was only employer's contribution (Section 36(1)(iv)). At that point in time, there was no question of employee's contribution being considered as part of the employer's earning. On the application of the original principles of law it could have been treated only as receipts not amounting to income. When Parliament introduced the amendments in 1988-89, inserting Section 3....
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....tribution required to be deposited by the employer (Section 36(1)(va)) was maintained - and continues to be maintained. On the other hand, Section 43B covers all deductions that are permissible as expenditures, or out-goings forming part of the assessees' liability. These include liabilities such as tax liability, cess duties etc. or interest liability having regard to the terms of the contract. Thus, timely payment of these alone entitle an assessee to the benefit of deduction from the total income. The essential objective of Section 43B is to ensure that if assessees are following the mercantile method of accounting, nevertheless, the deduction of such liabilities, based only on book entries, would not be given. To pass muster, actual....
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....ch is to ensure timely payment before the returns are filed, of certain liabilities which are to be borne by the assessee in the form of tax, interest payment and other statutory liability. In the case of these liabilities, what constitutes the due date is defined by the statute. Nevertheless, the assessees are given some leeway in that as long as deposits are made beyond the due date, but before the date of filing the return, the deduction is allowed. That, however, cannot apply in the case of amounts which are held in trust, as it is in the case of employees' contributions- which are deducted from their income. They are not part of the assessee employer's income, nor are they heads of deduction per se in the form of statutory pay ....