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2015 (7) TMI 9 - HC - Income TaxEntitlement to claim deduction of the belated payment to Provident Fund - Held that:- In terms of the Explanation to clause (va) of Section 36(1) of the Income Tax Act, such sums paid after the due date cannot be claimed as other deductions in terms of Section 36 of the Income Tax Act. This is pointedly so because in terms of Section 43B of the Income Tax Act, deductions are to be only on actual payment. These two provisions were considered in Hitech (India) Pvt. Ltd., vs. Union of India and others (1996 (12) TMI 23 - ANDHRA PRADESH High Court) in which it was held that a combined reading of clause (va) of Section 36(1) and Section 43B of the Income Tax Act makes it clear that if the assessee (employer) credited any sum received by him from any of his employees on or before the due date, that is, the date by which the assessee (employer) is required to credit the employees' contribution to the employees' account in the relevant fund (including the Provident Fund), he will be entitled to deduct the said amount in computing his business income. But, Section 43B controls the allowability of deduction of payment specified in clauses (a) to (d) thereof and provides certain conditions subject to which alone the deductions may be permissible. Enunciating the point, it was held that deduction would be available only if the remittance to the fund is made within the due date fixed for making such remittance into the fund; in the case in hand, the Provident Fund. So much so, the question referred is to be answered in favour of the Revenue. Hence we answer the reference by holding that on the facts and in the circumstances of the case, the assessee is not entitled to claim deduction of the belated payment to the Provident Fund in view of the provisions of the Explanation to clause (va) of Sections 36(1) and 43B of the Income Tax Act, in the light of the law laid in Hitech (India) Pvt. Ltd., vs. Union of India and others (supra).
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