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TMI Blog2024 (6) TMI 1272X X X X Extracts X X X X X X X X Extracts X X X X ..... ut of assessment/rectification orders passed u/s. 143(1)/154 of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') by DCIT/ACIT, Circle-2, DHN dated 10.09.2019, 14.12.2019, 16,04,2020, 01.05.2020 and 13.11.2019 respectively. 2. Shri Devesh Poddar, Advocate appeared on behalf of the assessee. Shri P. K. Koley, Sr. DR appeared on behalf of the revenue. 3. Though the assessee has raised as many as 6 grounds of appeal in each of the assessment years but the sole issue involved is in respect of confirming the addition u/s. 36(1)(va) and 43B being Employees share of PF which was deposited after the due date but before filing of the return of income. The details of disallowances made in the present five appeals is tabulated as under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to approved provident fund schemes, is the subject matter of Section 36(1) (iv). It is noteworthy, that this provision was part of the original IT Act; it has largely remained unaltered. On the other hand, Section 36(1)(va) was specifically inserted by the Finance Act, 1987, w.e.f. 01-04-1988. Through the same amendment, by Section 3(b), Section 2(24) - which defines various kinds of "income" - inserted clause (x). This is a significant amendment, because Parliament intended that amounts not earned by the assessee, but received by it, - whether in the form of deductions, or otherwise, as receipts, were to be treated as income. The inclusion of a class of receipt, i.e., amounts received (or deducted from the employees) were to be part of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he due date." The essential character of an employees' contribution, i.e., that it is part of the employees' income, held in trust by the employer is underlined by the condition that it has to be deposited on or before the due date. * The differentiation is also evident from the fact that each of these contributions is separately dealt with in different clauses of Section 36 (1). All these establish that Parliament, while introducing Section 36(1)(va) along with Section 2(24)(x), was aware of the distinction between the two types of contributions. There was a statutory classification, under the IT Act, between the two. * There is no doubt that in Alom Extrusions, this court did consider the impact of deletion of second proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc.) and avoid the mischief of employers retaining amounts for long periods. That Parliament intended to retain the separate character of these two amounts, is evident from the use of different language. Section 2(24)(x) too, deems amount received from the employees (whether the amount is received from the employee or by way of deduction authorized by the statute) as income - it is the character of the amount that is important, i.e., not income earned. Thus, amounts retained by the employer from out of the employee's income by way of deduction etc. were treated as income in the hands of the employer. The significance of this provision is that on the one hand it brought into the fold of "income" amounts that were receipts or deductions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 deduction from the employees' income and held in trust by the employer. This marked distinction has to be borne while interpreting the obligation of every assessee under Section 43B. * The non-obstante clause in section 43B would not in any manner dilute or override the employer&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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."
4. Respectfully following the decision of Hon'ble Supreme Court (supra) which squarely covers the grounds taken by the assessee are dismissed. Accordingly, all the appeals of the assessee are dismissed.
5. In the result, all the appeals of the assessee are dismissed.
Order is pronounced in the open court on 17th January, 2024. X X X X Extracts X X X X X X X X Extracts X X X X
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