Employee’s contribution to ESI/PF deposited for AY 2018-19 before filing of ITR is eligible for deduction: ITAT

  • Blog|News|Income Tax|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 25 April, 2022

Recent Posts

Blog, News, Company Law

[Opinion] Company & Its Directors Penalized for Using Private Placement Funds in Existing Account Before Filing Return of Allotment

News, Blog, Company Law

SEBI Amends Buy-Back Regulations | Excludes Shares Held by Non-Participating Promoters from Entitlement Ratio

Latest from Taxmann

Income-tax Act 1961 - Employees contribution (Finance Act 2021 amendment)

Case Details: Bromide Chemical Industries v. DCIT - [2022] 135 taxmann.com 79 (Jabalpur - Trib.)

Judiciary and Counsel Details

    • Sanjay Arora, Accountant Member
    • Sukesh Kumar, FCA for the Appellant. 
    • S.K. Halder, Sr. DR for the Respondent.

Facts of the Case

The assessee had deposited the amount received from his employees as contributions in Provident Fund and ESI fund after the due date prescribed in corresponding statutes but before the due date of filing return of income under section 139(1) for the relevant year.
Assessing Officer (AO) added same to assessee’s returned income under section 143(1)(a) as same stood deposited beyond due date specified under section 36(1)(va).

ITAT Held

The Tribunal held that the Finance Act 2021 had amended provisions of section 43B and section 36(1)(va) to restrict the deduction of an employee’s contribution to Provident Fund and ESI only if the same is deposited within the due date prescribed in corresponding statutes.

However, this amendment is prospective in nature, effective from Assessment Year 2021-22 as stated in notes on clauses to and Memorandum explaining Provisions of Finance Bill, 2021. Thus, no addition could be made if the sum deposited by the assessee towards employee’s contribution pertained to Assessment Year 2018-19.

Case Review

    • Nikhil Mohine v. Dy. CIT [IT Appeal Nos. 37 & 38 (Jab.) of 2021, dated 18-11-2021] (para 4.2) followed.

List of Cases Referred to

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

«
»

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied