PF / EPF, CPF, GPF etc. paid after due date but before ROI, cannot be disallowed u/s 43B or 36(1)(va)

Brief of the case:

PF / EPF, CPF, GPF etc. paid after due date but before ROI, cannot be disallowed u/s 43B or 36(1)(va)

In the case of ACIT Vs. M/s Supersonic Turner Pvt. Ltd., Jaipur Bench of ITAT have held that where ESI/PF received from the employees was deposited late but before the due date of filing return of income u/s 139 (1) the amount cannot be disallowed u/s 43B or 36 (1) (va).

Besides this ITAT also decided issues related to concealed sale and concealed sale of scrap on basis of difference between 26AS and P&L Account or ER-1 return.

Facts of the case:

• Assessee has derived income from manufacturing and job work of bearing rings and filed e-returndeclaring total income of Rs. 2,15,45,510/-.
• During assessment proceedings assessee was asked in respect of difference in job work receipts amounting to Rs. 27,27,293/-.
• Assessee came into agreement with various vendors for purchase of scrap. Assessee paid excise duty on the scrap which has been generated at the vendor’s premises as per agreement.
• During the course of assessment it was observed that the assessee had made late payment of ESI in all its units.

Contention of the revenue:

• In comparison to statement appearing 26AS, the assessee has declared the less amount of receipt.
• Assessee has sold goods but in respect of some debit notes related to sale ultimate effect would be nil regarding to which no proper explanation was filed before AO.
• AO formed opinion that assessee concealed job works.
• Debit note for Rs. 31,399/- were not pertained against the invoice issued during the year under consideration, therefore, the same are not deductable from the sales of the year.
• Sales of machinery and plants is not deductable on account of sales of goods to compare the sales as declared in ER-1. The sales not pertaining to year under consideration, also not deductable in the sales made during the year to compare the sales as declared in ER-1.
• As per Section 2(24)(x) read with Section 36(va), the payments of ESI and PF made late by the employer are considered as his income for the relevant year.

Contention of the assessee: