Case Law Details
Case Name : Ms. Unifac Management Services (India) Vs DCIT (Madras high Court)
Appeal Number : W.P.No. 5264 of 2018
Date of Judgement/Order : 23/10/2018
Related Assessment Year :
Courts :
All High Courts Madras High Court
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Ms.Unifac Management Services (India) Vs DCIT (Madras high Court)
Conclusion: Employees contribution towards EPF and ESI was rightly disallowed by AO as payment was made beyond the due date stipulated under the relevant enactment for making such payment u/s 36(1)(va).
Held: In the present case, AO made disallowance of a sum paid by the assessee as employees contribution
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What is payable, Both part of the contribution fund amount become payable on the date on which the salary is paid. The liability to pay, both the contributions employee as well as employer is on the employer. Therefore, any sum payable by the assessee as an employer by way of contribution to any provident fund provided in section 43B(b) means the contribution to provident fund if any payable by the assessee whether it is employees contribution or employer’s, both covered by the provisions of section 43B of the Act and allowable if paid on or before the due date of furnishing of return provided u/s 139(1) of the Act. Secondly the amount pertains to period falls within the period year under consideration if paid within the period year under consideration i.e. not shown as payable in financial of the year cannot be said to be payable withing the meaning of section 37 r.w.s. 28 of the Act.
Thus, I think the Hon’ble Court while observing that “I am not in agreement with the other decisions rendered by the High Courts of Karnataka, Punjab and Haryana and Allahabad, which in my view, did not consider the distinction of the scope and ambit of Section 36(1)(va) and Section 43B” has failed to the understand true intention of the legislative provided in section 43B of the Act made made a mistake by not accepting the aforementioned decisions findings
The payment made before filling the return should be allowed.As this is not finally kept by the employer. it may attract interest and penalty . Which is also imposed by the department and if it is added to the income is not justify at all.
It appears that the dismissal of SLP 3951/2017 by Honourable Supreme Court on 23/02/2017 against final judgment and order dated 26/05/2016 in DBITA No. 66/2015 passed by the Honourable High Court of Rajasthan at
Jaipur) in the case of PRINCIPAL COMMISSIONER OF INCOME TAX-II, JAIPUR VERSUS
M/S. RAJASTHAN STATE BEVERAGES CORPORATION LTD. was not brought to the knowledge of the Honourable High Court otherwise the decision would have been in favour of the assessee. The assessee must take it up.