SANJEEV KUMAR BAKSHI,HARYANA V. ASSESSING OFFICER, WARD 3, HARYANA

ITA 297/CHANDI/2024

AI Insights

The case involves an appeal by Sanjeev Kumar Bakshi against the order of the CIT(A)/NFAC, Delhi, which upheld the disallowance of Rs. 29,87,930. This amount represented employees' contributions to PF/ESI, which were deposited after the statutory due dates but before the due date of filing the return of income under section 139(1) of the Income-tax Act, 1961. The primary legal contention was whether such contributions, when deposited before the due date of filing the return, should be allowed as deductions. The Tribunal, referencing the Supreme Court's decision in Checkmate Services (P) Ltd. v. CIT, affirmed that these contributions must be deposited within the statutory due dates to qualify for deductions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 361000 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2018-2019
• Other Referred Cases: Checkmate Services (P) Ltd. v. CIT, Gujarat State Road Transport Corporation
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RANJIT KAUR
• Assessee Lawyers: PRIYANKA JINDAL
• Section: 43B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCHES, “SMC” CHANDIGARH HEARING THROUGH: HYBRID MODE BEFORE: SHRI. LALIET KUMAR, JUDICIAL MEMBER आयकर अपील सं./ ITA No. 297 /Chd/2024 िनधाŊरण वषŊ / Assessment Year : 2018-2019 Sanjeev Kumar Bakshi House No. 18, Sector-16 Panchkula, Haryana-134113 बनाम The ITO Ward-5 Panchkula ˕ायी लेखा सं./PAN NO: ACKPB6329H अपीलाथŎ/Appellant ŮȑथŎ/Respondent िनधाŊįरती की ओर से/Assessee by : Ms. Priyanka Jindal, Advocate राजˢ की ओर से/ Revenue by : Dr Ranjit Kaur, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 08/05/2025 उदघोषणा की तारीख/Date of Pronouncement: 20/05/2025 आदेश/Order PER LALIET KUMAR, J.M This is an appeal filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi dt. 31/07/2021 pertaining to Assessment Year 2018-19. 2. At the outset the Registry has pointed out that the above appeal is barred by limitation by 368 days. 3. After considering the condonation application filed by the assessee in the above appeal, we condone the delay for which sufficient cause is shown, and admit the appeal for adjudication. 4. In the present appeal, the solitary ground raised by the assessee is against the disallowance of Rs. 29,87,930/- on account of employees’ contribution towards PF/ESI, which was deposited after the due date as prescribed under the respective Acts but before the due date of filing the return of income under section 139(1) of the Income-tax Act, 1961. 2 5. The facts in brief are that the return of income was processed under section 143(1) of the Act by the CPC, Bangalore, disallowing employees’ contribution to PF/ESI to the extent of Rs. 29,87,930/-, relying upon the dates of actual payment furnished in the tax audit report, which indicated that the payments were made beyond the statutory due dates. 6. Before the CIT(A), the assessee contended that since the amounts were deposited before the due date of filing the return of income, the disallowance was not justified in view of section 43B read with judicial precedents. However, the Ld. CIT(A) upheld the disallowance, relying on the decision of the Hon’ble Gujarat High Court in the case of Gujarat State Road Transport Corporation [(2014) 41 taxmann.com 100] and the amendment introduced by the Finance Act, 2021, which inserted Explanation 2 to section 36(1)(va), clarifying that the provisions of section 43B do not apply to employees’ contributions. 7. We have heard the rival contentions and perused the material available on record. The issue involved in the present appeal is now no longer res integra in view of the authoritative pronouncement of the Hon’ble Supreme Court in the case of Checkmate Services (P) Ltd. v. CIT [(2022) 448 ITR 518 (SC)], wherein it has been held that employees’ contributions to PF/ESI, if not deposited within the due dates prescribed under the respective statutes, are not allowable as deductions, irrespective of the fact that such payments were made before the due date of filing the return of income. 7.1 The Hon’ble Supreme Court has categorically held that section 43B applies only to employer’s contributions and that section 36(1)(va) governs the employees’ share, and the same must be deposited within the time prescribed under the relevant welfare Acts. 7.2. Respectfully following the binding decision of the Hon’ble Apex Court, we find no infirmity in the order passed by the CIT(A). Accordingly, the ground raised by the assessee is dismissed. 3 8. In the result, appeal of the Assessee is dismissed. (Order pronounced in the open Court on 20/05/2025) Sd/- ( LALIET KUMAR) JUDICIAL MEMBER AG Date: 20/05/2025 आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to : 1. अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. आयकर आयुƅ (अपील)/ The CIT(A) 5. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 6. गाडŊ फाईल/ Guard File "