TaxTMI 
TaxTMI 
2025 (5) TMI 1060
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....ome at Rs. 7,07,15,109/- by denying deduction of Rs. 25,81,110/- claimed u/s 36(1)(va) r.w.s.43B of the Income-tax Act,1961 in respect of amount deposited towards employees contribution to EPF and ESIC. 2. In the facts and circumstances the ld. Commissioner of Income-tax (Appeals) has erred in confirming the order of ld. Assessing Officer. 3. The impugned order is bad in law and in facts. 4. The appellant craves leave to add, alter or omit all or any grounds of appeal in the interest of justice. ADDITIONAL GROUNDS OF APPEAL (1) In the facts and circumstances of the case and in law, the ld. Assessing Officer (CPC) has erred in making enhancement of Rs. 25,81,110/- u/s 143(1)(a) of the Income-tax Act, 1961 of an item not covered under relevant provisions of the Act. (2) In the facts and circumstances of the case and in law the adjustment is illegal and without jurisdiction as it relates to an item of debatable in nature because divergent decisions of different High Courts were ruling the field as on the date of impugned adjustment. 3. This matter was earlier disposed of by this tribunal vide its order dated 07.07.2023, by dismissing ....
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....essee and Smt. Anubhaa Tah Goel ("Ld. Sr. DR") representing the revenue have raised their respective contentions and made necessary submissions. After hearing the Ld. Counsel of both the sides the matter was taken as heard. 5. At the outset, Ld. AR submitted a written synopsis, the same is culled out as under: BEFORE THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH: RAIPUR (C.G.) Name of the Appellant Shree Shivam Attires Private Limited PAN/Status/Assessment Year AANCS9084N/Company/2018-19 I.T. Appeal No. 111/RPR/2021 SYNOPSIS6. 1. The appellant filed return of income for assessment year 2018- 19 on 25/10/2018 declaring total income at Rs. 6,81,34,000/- after claiming deduction of Rs. 25,81,110/- with respect to amount deposited towards the employee's contribution to Provident Fund and Employee State Insurance Corporation. 2. The Centralized Processing Centre (CPC) processed the return and computed total income at Rs. 7,07,15,110/- after disallowing said claim of Rs. 25,81,110/- on the ground that it was not credited to the relevant fund on or before the due date. It had instructed to file rectification request under s....
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....ted 11.05.2023. Accordingly, Ld. AR requested that the appeal of assessee may be allowed in the interest of justice. 7. Ld. Sr. DR on the other hand, submitted that the issue is squarely covered by the judgment of Hon'ble Jurisdictional HC in the case of BPS Infrastructure vs ITO in TAXC No. 87 of 2024 dated 12.04.2024, therefore, the contention raised by the Ld. AR have no substance to be hold good in the eyes of law, consequently, the appeal of assessee is liable to be dismissed. 8. We have considered the rival submission perused the material available on record and case laws relied upon by the parties. The sole controversy in the present case is whether deduction claimed u/s 36(1)(va) r.w.s 43B qua the employee's contribution towards EPF & ESIC can be denied in a case where the payment was made after the due date in the respective statutes but was made before filing of the return u/s 139, especially in a case, where the return of the assessee is processed u/s 143(1)(a) as the issue was debatable in nature because of the divergent decisions of different High Court's ruling the field as on the date of impugned adjustment. 8.1 In this case, the assessee has placed his reli....
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....ok, was only employer's contribution (Section 34(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 36(1)(va) and simultaneously inserting the second proviso of Section 43B, its intention was not to treat the disparate nature of the amounts, similarly. As discussed previously, the memorandum introducing the Finance Bill clearly stated that the provisions - especially second proviso to Section 43B - was introduced to ensure timely payments were made by the employer to the concerned fund (EPF, ESI, etc.) and avoid the mischief of employers retaining amounts for long periods. That Parliament intended to retain the separate character of these two amounts, is evident from the use of different language. Section 2(24)(x) too, deems amount received from the employees (whether the amount is received from the employee or by way of deduction authorized by the statute) as income - it is the character of the amount that is ....
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....g the obligation of every assessee under Section 43B. 54. In the opinion of this Court, the reasoning in the impugned judgment that the non-obstante clause would not in any manner dilute or override the employer's obligation to deposit the amounts retained by it or deducted by it from the employee's income, unless the condition that it is deposited on or before the due date, is correct and justified. The non-obstante clause has to be understood in the context of the entire provision of Section 43B which 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 the....