ITA No. 1458/DEL/2021 features a dispute between the AO of CPC Bengaluru and Kamlesh Kumar Singh over the disallowance of Provident Fund (PF) and Employee State Insurance (ESI) contributions due to deposit delays for the Assessment Year 2017-18.
The case revolves around the deductions claimed for employee contributions to PF and ESI which were not deposited by the prescribed deadlines under relevant sections of the Income Tax Act. The main contention was whether these late deposits should be disallowed.
During the proceedings, the tribunal considered various judicial precedents and statutory guidelines pertaining to employee contributions towards social securities. It noted the importance of complying with the stipulated timelines for depositing these contributions to avail tax benefits.
The tribunal’s decision, which allowed for the deduction of these contributions provided they were deposited before the due date of filing the income tax return, underscores a lenient interpretation aimed at benefiting the taxpayer under specific circumstances. The case highlights the critical nature of timely compliance with fiscal obligations and its impact on tax liabilities.
The ruling in ITA 1458/DEL/2021 provides valuable insights into the handling of delays in the deposit of PF and ESI contributions, establishing a precedent for similar cases regarding the interpretation and application of tax law related to employee benefits.
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