TMI Blog2020 (2) TMI 792X X X X Extracts X X X X X X X X Extracts X X X X ..... ution and to deposit the same in the fund. Finding recorded by the Tribunal that if such wages are paid for the following month, the liability to deposit the employee's contribution to the fund gets deferred by another month is not the correct statement of law. -Decided in favour of the Revenue and against the assessee. - R/TAX APPEAL NO. 860 of 2019 - - - Dated:- 11-2-2020 - MR. J.B.PARDIWALA AND MR. BHARGAV D. KARIA JJ. Appearance: Mrs. Mauna M. Bhatt (174) for the Appellant(s) No. 1 Mr. Tushar Hemani Senior Advocate With Ms. Aditi Sheth With Ms. Vaibhavi K Parikh(3238) Advocates for the Opponent(s) No. 1 ORAL ORDER (PER : MR.J.B.PARDIWALA) 1. This Tax Appeal under Section 260A of the Income Tax Act, 1961 [for short, 'the Act, 1961'] is at the instance of the Revenue and is directed against the order passed by the Income Tax Appellate Tribunal, Ahmedabad 'D' Bench, Ahmedabad dated 25th June 2019 in CO No.77/Ahd/2017 for the A.Y. 2011-12. 2. This Tax Appeal was ordered to be admitted on the following substantial question of law: Whether the Appellate Tribunal has erred in law and on facts in setting aside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve. The relevant portion of the said judgment is as follows:. 3. Learned representatives fairly agree that the aforesaid issue is squarely covered against the assessee by Hon'ble jurisdictional High Court's judgment in the case of CIT vs. Gujarat State Road Transport Corporation, 366 ITR 170 (Guj.), wherein it is categorically held that in the case of delayed deposit of employees contribution to PF, the same will not deductible in computing income under section 28 of the Act. The law so laid down by the Hon'ble jurisdictional High Court is binding on us. The mere fact that an appeal against the said decision is pending before the Hon'ble Supreme Court does not dilute binding nature of this judicial precedent. As regard dismissal of SLP in the case of Rajasthan State Beverages Corporation Ltd (2017) 84 taxmann.com 185 (SC), it is only elementary that when a SLP is dismissed by a non-speaking order, it does not constitute a law declared by Hon'ble Supreme Court, and as such, it is not binding under Article 141 of the Constitution of India. The authority, for this proposition, is contained in a serious of judgments of Hon'ble Supreme Court, includin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes. 5. The Revenue being dissatisfied with the order passed by the Appellate Tribunal is here before this Court with the present appeal. 6. The substantial question of law as raised by the Revenue for our consideration is no longer res integra, more particularly, in view of the decision of this Court dated 15th October 2018 in the case of M/s Checkmate Facility and Electronic Solutions Pvt Ltd vs. Deputy Commissioner of Income Tax Circle 1 rendered in Tax Appeal No.1256 of 2018. We quote the entire judgement delivered by the Coordinate Bench of this Court as follows: 1. Appellant-assessee has challenged the judgment of the Income Tax Appellate Tribunal dated 22.03.2018. Following questions are presented for our consideration: 1. Whether on facts and in law, the Income Tax Appellate Tribunal is right in confirming disallowance of ₹ 1,16,87,091/u/ s 2(24)(x) r.w.s. 36(1)(va) for delay in payment of employee s contribution to PF and ESI in spite of the fact that it was deposited before due date of filling return of income? 2. Whether on facts and in law, the Income Tax Appellate Tribunal is right in confirming disallowance of ₹ 1,16, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ample, therefore if the salary payment for the month of June is made on 5th July, the employer would have time upto 15th of August for depositing the employee s contribution of provident fund. Looking from this angle, there was no delay or default on the part of the present assessee. 4. In terms of section 36(1)(va) of the Act, any sum received by the assessee from any of his employees to which the provisions of section 2(24)(x) applies, would be deducted as long as such sum is credited by the assessee to the employee s account in the relevant funds on or before due date. Explanation to the said subsection provides that for the purpose of the said clause, due date means a date by which the assessee is required as an employer to credit an employee s contribution to the account in which relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise. Section 38 of the Employees Provident Funds and Miscellaneous Provisions Act, 1952, becomes relevant. Subsection (1) thereof reads as under: (1) The employer shall, before paying the member his wages in respect of any period or part of period for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yer before paying him his wages to deduct the employee's contribution along with the employer's own contribution as fixed by Government. The employer is further obliged to pay the same within fifteen days of the close of every month pay i.e. such contribution and administrative charges. The reference to fifteen days of the close of the month must be in relation to month during which the payment of wages is to be made and corresponding liability to deduct employee's contribution to the fund arises. This Court held that 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. 8. In such circumstances referred to above, the finding recorded by the Tribunal that if such wages are paid for the following month, the liability to deposit the employee's contribution to the fund gets differed by another month is not the correct statement of law. 9. In view of the aforesaid, this appeal succeeds and is hereby allowed. The impugned order passed b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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