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2024 (1) TMI 51 - AT - Income TaxDisallowance of late payment of PF & ESIC made u/s. 143(1) - HELD THAT:- Issue decided following Checkmate Services (P.) Ltd. [2022 (10) TMI 617 - SUPREME COURT] held that non obstante clause under section 43B could not apply in case of employee's contribution which were deducted from their income and was not part of assessee-employer's income and, thus, said clause would not absolve assessee-employer from its liability to deposit employee's contribution on or before due date as a condition for deduction. Decided against assessee. Argument of the assessee namely “due– date” for payment of employees’ contribution to PF/ESI has to be reckoned from the “month of actual payment of salary” and not from the “month of salary in which becomes payable” - this issue is also considered by the Hon’ble High Court of Gujarat in M/s. Checkmate Facility And Electronic Solutions Pvt. Ltd. Vs. DCIT [2018 (10) TMI 994 - GUJARAT HIGH COURT] as provision thus requires an employer before paying the employee his wages to deduct employee's contribution along with the employer's own contribution as fixed by the Government. It is further required that he shall within fifteen days of the close of every month pay the same to the fund such contribution and administrative charges. In terms of this provision thus, after deducting the employee's contribution towards the funds, the same has to be deposited with the Government within fifteen days of the close of every month. Reference to fifteen days of the close of the month must be in relation to the month during which the payment of wages is to be made and corresponding liability to deduct employee's contribution to the fund arises. The expression "within fifteen days of the close of every month" therefore must be interpreted as having reference to the close of the month, for which, the wages are required to be paid with corresponding duty to deduct employee's contribution and to deposit the same in the fund. Appellant is therefore not correct in contending that if such wages are paid in the following month, the liability to deposit the employee's contribution to the fund gets differed by another month. Adjustments / additions u/s 143(1) - CPC made disallowed without considering the objections / reply filed by the assessee - Empty formality - HELD THAT:- It is highly expected the CPC on receipt of the objection filed by the assessee, consider the same in accordance with law and then proceed with as per the provisions u/s. 143(1) or to proceed with regular scrutiny assessment u/s. 143(3) by issuing notice u/s. 143(2) of the Act. Further it is noted that the assessee filed additional documents invoking Rule 46A of the I.T. Rules, by filing Form 26A before NFAC, the same was also not adjudicated by any NFAC in its order. In our considered view, Ld. NFAC ought to have considered the above additional documents and adjudicated the case in accordance with law. Since it is only a proceeding u/s. 143(1) and not a scrutiny assessment where assessee is expected to file all necessary documents along with the Return of Income. Thus in our considered opinion, Ld. NFAC failed to entertain the additional documents filed by the assessee, we therefore set aside the issue to file of JAO and the Ground No.2 raised by the assessee is partly allowed.
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