Case Number: ITA 1911/DEL/2020
Appellant: Uttam Industrial Engineering Private Limited, New Delhi
Respondent: DCIT Circle-25(1), New Delhi
Assessment Year: 2018-19
Case Filed On: 2020-12-01
Order Type: Final Tribunal Order
Date of Order: 2022-08-01
Pronounced On: 2022-08-01
The case ITA 1911/DEL/2020 involves Uttam Industrial Engineering Private Limited, New Delhi, as the appellant, and DCIT Circle-25(1), New Delhi, as the respondent. The case pertains to the assessment year 2018-19 and was filed on December 1, 2020. The final tribunal order was pronounced on August 1, 2022, by the Delhi Bench ‘H’ of the Income Tax Appellate Tribunal (ITAT).
Uttam Industrial Engineering Pvt. Ltd. faced disallowance issues related to the employee’s contribution to Provident Fund (PF) and Employees’ State Insurance (ESI). The central question was whether the contributions made after the due date but before the filing of the income tax return should be allowed as a deduction under the Income Tax Act.
The tribunal was composed of Dr. B. R. R. Kumar, Accountant Member, and Sh. Anubhav Sharma, Judicial Member. They adjudicated multiple cases dealing with similar issues, including the case of Uttam Industrial Engineering Pvt. Ltd.
The key issue was whether the payment of employee’s PF and ESI contributions after the statutory due date but before the due date of filing the income tax return could be allowed as a deduction. This issue has seen varying interpretations across different tribunal benches and high courts.
The tribunal reviewed numerous cases and judgments from various high courts and ITAT benches, which held that if the employee’s contributions to PF and ESI are paid before the due date of filing the income tax return, they should be allowed as deductions. Some key judgments reviewed include:
The tribunal noted that the payments were made before the filing of the income tax return and, as such, should be allowed as deductions.
The tribunal allowed the appeals of Uttam Industrial Engineering Pvt. Ltd., holding that no disallowance was called for the belated payment of employee’s contributions to PF and ESI, provided they were paid before the due date of filing the income tax return.
The order was pronounced in the open court on August 1, 2022, and signed by both members of the bench.
This order is significant as it aligns with the view that payments made before the due date of filing the return should be allowed as deductions, providing clarity and uniformity in the treatment of such cases. It reflects the judicial discipline and adherence to precedents set by various high courts and ITAT benches.
The decision underscores the importance of adhering to statutory deadlines for PF and ESI contributions while also recognizing the practical challenges faced by employers. This balanced approach ensures compliance while also providing relief to taxpayers who make efforts to fulfill their obligations within the extended timelines.
The case highlights the evolving interpretation of tax laws and the role of judicial decisions in shaping the application of these laws, ensuring fairness and consistency in tax administration.
Final Tribunal Order: Uttam Industrial Engineering Pvt. Ltd. vs. DCIT (2018-19)
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