Case Law Details
Drishti Apparels Vs DCIT (ITAT Delhi)
ITAT Delhi has dismissed the appeal of Drishti Apparels against the disallowance of deduction claimed for delayed deposit of employees’ contribution to Provident Fund (PF) and Employees’ State Insurance (ESI). The CPC had noticed that the contributions were not deposited within the due date prescribed under the relevant statutes, and the deduction was deemed inadmissible. The rectification application was rejected, and the first appellate authority confirmed the disallowance.
The appeal relates to the disallowance of a deduction claimed for delayed deposit of employees’ contribution to Provident Fund (PF) and Employees’ State Insurance (ESI). The CPC noticed that the contributions were not deposited within the prescribed due date under the relevant statutes, resulting in the inadmissibility of the deduction. The rectification application was rejected, and the first appellate authority confirmed the disallowance.
ITAT Delhi notes that the disputed disallowance represents delayed payment of employees’ contribution to PF and ESI for the relevant assessment year. The assessee claims that the payments were made within the due date of filing the income tax return. However, the ITAT cites a Supreme Court decision in the case of Checkmate Services Pvt. Ltd. Vs CIT-I, which decided against the assessee’s claim for similar delayed payments. Based on this decision, the ITAT deems the claim of the assessee as not acceptable and dismisses the grounds raised.
The claim for a deduction for delayed deposit of employees’ contribution to PF and ESI is deemed inadmissible, following the decision of the Supreme Court in a similar case. The disallowance stands, and the appeal is dismissed.
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