Case Law Details
J & K Tourism Development Corporation Ltd. Vs ACIT (ITAT Amritsar)
No disallowance can be made that the payment to the employee’s contribution to PF and ESI paid by the assessee before the due date of filing of return of income u/s. 139(1). Accordingly, we hold that no disallowance can be made in the assessment year prior to Assessment Year 2021-22.
Facts- In all the cases the action of the AO disallowing the amount being contribution of employees’ share towards Provident Fund, ESI, PF or any other fund set up for the welfare of the employee u/s 36(1)(va) read with Section 2(24)(x) when the payments were made within the due dates of filing of return u/s 139(1) of the Act.
In brief in the lead case the AO disallowed the deduction amount to Rs. 1,58,45,576/- during assessing the return U/s 143(3) of the Act in respect of employees’ contribution towards PF and ESI. According to the AO, in view of Section 2(24)(x) rws 36(1)(va) of the Act, the employees contribution is to be paid within the due date of payment as prescribed in the respective Acts (PF/ESI Acts) to claim deduction. But the assessee paid the amount before filing of Income tax Return U/s 139(1) of the Act not within the stipulated dates under PF & ESI Act.
CIT(A) uphold the order. Being aggrieved, the assessee preferred the present appeal.
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