TMI Blog2023 (3) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant statute is not allowable as deduction under section 36(1)(va). Decided against assessee. - ITA no.2842/Mum./2022 - - - Dated:- 22-2-2023 - Shri Om Prakash Kant, Accountant Member And Shri Sandeep Singh Karhail, Judicial Member For the Assessee : Shri Niraj Sheth For the Revenue : Smt. Mahita Nair ORDER PER SANDEEP SINGH KARHAIL, J.M. The present appeal has been filed by the assessee challenging the impugned order dated 08/09/2022, passed under section 250 of the Income Tax Act, 1961 ( the Act ) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [ learned CIT(A) ], for the assessment year 2020-21. 2. In this appeal, the assessee has raised the following gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The said return was processed under section 143(1) of the Act vide intimation dated 26/12/2021, computing the total income of the assessee at Rs.465,34,00,840, after making an addition of Rs.6,30,42,740, on account of delayed payment towards employee s contribution to provident fund under section 36(1)(va) of the Act. 5. The learned CIT(A) vide impugned order dated 08/09/2022 dismissed the appeal filed by the assessee on this issue and held that if the employer fails to deposit the entire amount towards employees contribution on account of provident fund with concerned department on or before the due date under the relevant statute, the assessee shall not be entitled for deduction to that extent. Being aggrieved, the assessee is in appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contribution which is its primary liability under law in terms of Section 36(1)(iv), and its liability to deposit amounts received by it or deducted by it (Section 36(1)(va)) is, thus crucial. The former forms part of the employers income, and the later retains its character as an income (albeit deemed), by virtue of Section 2(24)(x) - unless the conditions spelt by Explanation to Section 36(1)(va) are satisfied i.e., depositing such amount received or deducted from the employee on or before the due date. In other words, there is a marked distinction between the nature and character of the two amounts the employer s liability is to be paid out of its income whereas the second is deemed an income, by definition, since it is the deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date specified in the particular law. They have to be deposited in terms of such welfare enactments. It is upon deposit, in terms of those enactments and on or before the due dates mandated by such concerned law, that the amount which is otherwise retained, and deemed an income, is treated as a deduction. Thus, it is an essential condition for the deduction that such amounts are deposited on or before the due date. If such interpretation were to be adopted, the non-obstante clause under Section 43B or anything contained in that provision would not absolve the assessee from its liability to deposit the employee s contribution on or before the due date as a condition for deduction. 9. We find that, recently, in Nissan Enterprise Ltd. vs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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