2018 (10) TMI 1386 - MADRAS HIGH COURT

Additions towards EPF and ESI u/s 36(1)(va) - employee's contribution - sum paid towards Employees Provident Fund and ESI beyond the due date, but prior to filing of return - “employees” and “employers” cannot be brought under the same scope and ambit of Section 43B to claim deduction - Held that:- The scope of Section 43B and Section 36(1)(va) are different and thus, there is no question of reading both provisions together to consider as to whether the assessee is entitled to deduction in respect of the sum belatedly paid towards such contribution, especially when such sum is, admittedly, a sum received by the assessee/employer from his employee. Therefore, for considering such question, application of Section 36(1)(va) r.w.s. 2(24)(x) alone is the proper course and any other interpretation would only defeat the object and scope of both the provisions viz., 43B and 36(1)(va).

Thus we are in full agreement with the decisions in Commissioner of Income Tax-II vs Gujarat State Road Transport Corporation [2014 (1) TMI 502 - GUJARAT HIGH COURT] and Commissioner of Income Tax vs Merchem Ltd [2015 (9) TMI 560 - KERALA HIGH COURT]. Consequently, with great respect, in agreement with the other decisions rendered by the High Courts of Karnataka, Punjab and Haryana and Allahabad, which in my view, did not consider the distinction of the scope and ambit of Section 36(1)(va) and Section 43B.

Accordingly, find no error apparent on the face of the order passed by the Assessing Authority, based on the admitted facts. Accordingly, the writ petition fails and the same is dismissed.