This document provides a detailed review of the ITA 75/DEL/2019 case between the Additional Commissioner of Income Tax, Special Range-8, New Delhi and Shivalik Prints Ltd. concerning the assessment year 2012-13. The main issue revolves around the disallowance of late EPF/ESI contributions.
The appellant, Addl. CIT, Special Range-8, New Delhi, challenged the order of the CIT(A) that allowed deductions for late payment of employee contributions to EPF and ESI. Initially disallowed by the AO, the payments were deemed deductible by the CIT(A) since they were made before the due date of the return filing, referencing significant case laws including CIT vs. AIMIL Ltd.
The tribunal considered various judicial precedents and upheld the CIT(A)’s decision, emphasizing that the payments were indeed made before the filing of the return of income. The tribunal also noted that the amendment brought by the Finance Act 2021, which was argued by the DR, did not apply to the assessment year in question as it is effective from AY 2021-22 onwards.
The tribunal’s decision reinforces the principle that compliance within the statutory timelines for filing returns is crucial for the deductibility of EPF/ESI contributions. This case also highlights the relevance of understanding legislative changes and their applicational timeframe. The decision in favor of Shivalik Prints Ltd. stands as a testament to the judiciary’s stance on supporting timely tax compliance efforts by businesses.
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