Case Law Details
C. Doctor & Co . Pvt. Ltd Vs ACIT (ITAT Mumbai)
Introduction: The case of C. Doctor & Co. Pvt. Ltd. vs. ACIT, adjudicated by the ITAT Mumbai, delves into the disallowance of contributions made by employees if not deposited within the due dates prescribed under the Provident Fund (PF) and Employees’ State Insurance Corporation (ESIC) Acts. The decision of the Mumbai ITAT significantly impacts the appellant, C. Doctor & Co. Pvt. Ltd., and sheds light on the interpretation of relevant tax laws.
Detailed Analysis: C. Doctor & Co. Pvt. Ltd., the appellant, filed an appeal against the order of the Commissioner of Income Tax (Appeals) 21, Mumbai (CIT(A)), contesting the disallowance made by the Assessing Officer (AO) regarding employee contributions to Provident Fund (PF) and Employees’ State Insurance Corporation (ESIC). The disallowance amounted to Rs. 8,14,634, as the contributions were deposited belatedly but before the due date for filing the return of income under section 139 of the Income-tax Act, 1961.
The appellant contended that the disallowance was erroneous and cited various judgments, including those of the Supreme Court and ITAT benches, to support their argument. However, both the AO and the CIT(A) upheld the disallowance.
The ITAT Mumbai, upon careful consideration, observed that although the contributions were deposited before the due date for filing the return of income, they were not deposited within the due dates prescribed under the PF and ESIC Acts. Citing the decision of the Supreme Court in the case of Checkmate Services Pvt. Ltd. vs. CIT, the ITAT held that such contributions, if not deposited within the prescribed due dates under the respective Acts, are disallowable.
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