This article reviews the Income Tax Appellate Tribunal’s decision in ITA No. 2269/DEL/2022, which addresses the critical issue of timely PF and ESI payments by Ironman Security Services Pvt. Ltd. for the fiscal year 2018-19.
The case arises from the Revenue’s challenge to the CIT(A)’s deletion of disallowances related to belated PF and ESI payments made by the respondent. The pivotal issue was whether these late payments could still be allowed following various judicial precedents and the Supreme Court’s decision in Checkmate Services.
The tribunal, after noting the absence of the assessee’s representation despite multiple notices, proceeded exparte. It ultimately set aside the CIT(A)’s decision based on the Supreme Court’s recent ruling, which solidified the stance that late PF and ESI contributions are not allowable deductions.
This case serves as a significant reference point for understanding the implications of the Supreme Court’s ruling on the treatment of late PF and ESI payments under tax law. It underscores the need for timely compliance with statutory payment obligations to avoid adverse tax consequences.
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