This review covers the ITAT Delhi’s decision on Adinath Industries’ appeal against the ITO, Ward-50(1), New Delhi, concerning the disallowance of deductions for employees’ contribution to Provident Fund (PF) and Employees’ State Insurance (ESI) for the assessment years 2018-19 and 2019-20.
The case arises from orders issued by the National Faceless Appeal Centre (NFAC), Delhi, which disallowed deductions claimed by the assessee firm due to late deposit of employees’ contributions to PF and ESI.
The main issue revolves around the admissibility of deductions for employees’ contributions to statutory funds not deposited within the due dates specified by relevant statutes, but before the due date of filing the return under section 139(1) of the Income Tax Act.
The tribunal analyzed the adherence to statutory deadlines for depositing employees’ contributions to PF and ESI, referencing the Supreme Court’s decision in Checkmate Services Pvt. Ltd. vs CIT-I, which set a precedent unfavorable to the assessee’s claims.
The ITAT dismissed the appeals, upholding the NFAC’s decision to disallow the deductions based on statutory non-compliance with the prescribed timelines for depositing employees’ contributions to PF and ESI.
Adinath Industries vs. ITO, Ward-50(1), New Delhi – ITA 2518/DEL/2022
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