Woodland (Aero Club) Private Limited Vs ACIT (Delhi High Court)
Delhi High Court held that employee’s contribution deposited after statutory due date under relevant Acts is disallowed under section 143(1)(a) of the Income Tax Act even if the same is paid before filing of income tax return. Accordingly, question is decided against appellant.
Facts- The appellant is a Partnership Firm engaged in the business of manufacturing, supply and export of leather products like leather shoes, leather garments under the name of Woodland. The case of the assessee was selected for scrutiny by notice dated 17/12/2019 issued u/s 143(l)(a) of Act wherein adjustments to the tune of ₹4,14,22,293/- were proposed to be deducted from the income of the appellant by AO on account of payment of Provident Fund, Employer’s State Insurance and Labour Welfare Fund to the extent of the disputed amount deposited beyond the due date of the relevant fund under the Act. In the assessment order made by the AO in the appellant’s case u/s. 143(1) of the Act, the AO made adjustments/additions in respect of these payments. The present appeal is filed challenging order dated 09.01.2023 passed by ITAT.
Conclusion- In Commissioner of Income Tax II v. Gujarat State Road Transport Corporation it is held that with respect to the employees contribution received by the assessee if the assessee has not credited the said sum to the employees‘ account in the relevant fund or funds on or before the due date mentioned in explanation to section 36(1) (va), the assessee shall not be entitled to deductions of such amount in computing the income referred to in section 28 of the Act. Thus, held the ITAT is justified in passing the order dated 09.01.2023. We find no infirmity in the same. The first question of law is decided against the appellant.
