This article analyzes the decision of the Income Tax Appellate Tribunal regarding the case between Airads Limited and the Assistant Commissioner of Income Tax (ACIT) for the assessment year 2020-21, focusing on the disallowances related to employee contributions and TDS payments.
Airads Limited, a company based in New Delhi, filed an appeal against the order passed by the National Faceless Appeal Centre (NFAC), which pertained to the disallowances of employee contributions to Provident Fund and State Insurance (ESI), along with issues related to the payment of Tax Deducted at Source (TDS).
The tribunal reviewed adjustments made by the Centralized Processing Centre (CPC) to the company’s income due to alleged late payment of employee contributions to PF, ESI, and TDS. The first appellate authority confirmed these additions. However, the appellant argued that all related payments were made within the due dates set by the statute, which were extended due to the COVID-19 pandemic. The tribunal directed the Assessing Officer to verify these submissions.
The tribunal highlighted the need for proper verification of facts, especially since the faceless appeal proceedings did not adequately address the appellant’s claims. The tribunal directed the Assessing Officer to verify the remittances and, if found timely, to delete the additions made to the appellant’s income.
This case underscores the importance of maintaining clear records and timely compliance with statutory requirements for employee contributions and TDS payments. It also illustrates the challenges and complexities that can arise in faceless assessments and the appellate process.
Dispute Over Employee Contributions: Airads Limited vs ACIT, Assessment Year 2020-21
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