Case Number: ITA 1754/DEL/2020
Appellant: Toshiba Water Solutions & Services Pvt Ltd, New Delhi
Respondent: DCIT Circle-27(2), New Delhi
Assessment Year: 2017-18
Case Filed On: 2020-10-22
Order Type: Final Tribunal Order
Date of Order: 2022-08-01
Pronounced On: 2022-08-01
This case involves an appeal filed by Toshiba Water Solutions & Services Pvt Ltd against the DCIT Circle-27(2), New Delhi for the assessment year 2017-18. The appeal, registered as ITA 1754/DEL/2020, was filed on October 22, 2020, and concerns the disallowance of payments made towards Employees’ State Insurance (ESI) and Provident Fund (PF) under section 36(1)(va) read with section 43B of the Income-tax Act, 1961.
The case was heard by the Delhi Bench ‘H’ of the Income Tax Appellate Tribunal (ITAT) on July 21, 2022, with the order pronounced on August 1, 2022. The bench comprised Judicial Member Sh. Anubhav Sharma and Accountant Member Dr. B. R. R. Kumar.
The primary grounds of appeal were:
The appellant, represented by Advocate Sh. Manish Malik, argued that the disallowance of ESI and PF payments was incorrect as the payments were made before the due date of filing the return under section 139(1). The appellant contended that the payments should be allowed as deductions as per the provisions of section 43B of the Income-tax Act, 1961, and various judicial precedents.
The tribunal noted that the issue of disallowance of ESI and PF payments has been adjudicated in several cases and that if the payment is made before the due date of filing the return, it should be allowed as a deduction. The tribunal referred to several judgments, including those of the Hon’ble Supreme Court and various High Courts, supporting the appellant’s contention.
The tribunal referred to the following judgments:
The tribunal concluded that the disallowance of ESI and PF payments made before the due date of filing the return under section 139(1) was not justified. The tribunal allowed the appeal of the assessee, directing the Assessing Officer to rectify the error and allow the deductions for the ESI and PF payments made before the due date of filing the return.
In conclusion, the appeal filed by Toshiba Water Solutions & Services Pvt Ltd was allowed. The tribunal directed the Assessing Officer to rectify the disallowance of ESI and PF payments and allow the deductions as per the provisions of section 43B of the Income-tax Act, 1961.
The tribunal’s order was pronounced on August 1, 2022, by Judicial Member Sh. Anubhav Sharma and Accountant Member Dr. B. R. R. Kumar, directing the rectification of the error in the disallowance of ESI and PF payments.
Members:
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