S.S. Saib Construction Pvt. Ltd. faced a critical assessment from the Assessing Officer in Faridabad regarding provident fund and ESI contributions for the assessment year 2017-18, leading to an appeal in ITA No. 1649/DEL/2021.
The case revolved around the delay in depositing employees’ provident fund and ESI contributions, which the assessing officer adjusted against the company’s returns, leading to significant tax implications.
The Income Tax Appellate Tribunal in Delhi reviewed the appeal, with a particular focus on whether the legislative amendments via the Finance Act 2021 applied to the case, potentially impacting the interpretation of delayed payments as non-deductible expenses.
The appellant argued that all contributions, though delayed, were completed before the filing of the tax return, citing precedents that supported the view that such contributions should not attract penalties if completed before tax filing. The Tribunal agreed with this perspective, emphasizing the need for legislative clarity and the importance of adhering to established jurisprudence that favored the assessee under similar circumstances.
The Tribunal’s decision allowed the appeals of S.S. Saib Construction, dismissing the revenue’s appeal and setting a significant precedent for how similar cases should be handled in the future, particularly concerning the timing of contributions.
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