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2021 (9) TMI 363 - AT - Income TaxDisallowance on account of delayed deposit of Employees’ Contribution to PF and ESI - delay in clearance of cheque - as argued the delay in such deposit was attributable to the technical reasons of delay in clearance of cheque although such cheques had been issued by the assessee on due dates as per the respective Acts of ESI and PF? - whether for the purpose of section 36(1)(va) of I.T. Act, date of deposit of cheque in the bank is relevant or the date of clearance of the cheque is relevant? - HELD THAT:- As decided in REPCO HOME FINANCE LTD. [2014 (11) TMI 487 - MADRAS HIGH COURT] even if the cheques were taken conditionally, the cheques not having been dishonoured but having been cashed, the payment related back to the dates of the receipt of the cheques and in law the dates of payments were the dates of the delivery of the cheques. The Hon’ble High Court further held that once the cheque issued by the assessee is encashed, the payment relates back to the date of receipt of the cheque. We are of the view that the relevant date to be considered for the purpose of section 36(1)(va) of I.T. Act is the date of deposit of cheque in the bank, and not the date of clearance of the cheque. Consequently, we hold that the aforesaid amount as allowable under section 36(1)(va) of I.T. Act. Accordingly, we direct the Assessing Officer to allow the aforesaid amount - Assessee appeal is allowed.
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