- (1.) Heard learned standing counsel for the Income-tax Department and Shri Ashish Bansal appearing for the assessee. This income-tax appeal has been filed against the judgment and order dated January 11, 2008, passed by the Income-tax Appellate Tribunal in I.T.A. No. 562/Luc/2007.
(2.) The Assessing Officer by assessment order dated November 16, 2006, has disallowed the claim of the late payment of PF and ESI. The provident fund and ESI contributions were to the extent of Rs. 12,36,139 which was paid by the assessee before filing of the return and proof of payment was submitted before the Assessing Officer. The Assessing Officer had issued a show-cause notice requiring to show cause as to why the amount deposited in the account of each employee after due date may not be deducted under the provision of section 43B read with section 36(1) sub-section (va) of the Income-tax Act. The assessee submitted the reply to the show-cause notice. The Assessing Officer disallowed the claim holding that the payments were not made by due dates. The following observations were made by the Assessing Officer while rejecting claim: In view of the above discussion, it is clear that due date of credit of contribution by way of P.F. and E.S.I. in the shape of contribution by the employer and employee the due date is 15th of each following month in which/for which pay was drawn. In these circumstances, the submission of the assessee is hereby rejected as the assessee has violated the provisions of section 43B read with section 36(1)(va) (Explanation as well as section 2(24)(x)) of the Income-tax Act, 1961. Therefore, the amount of Rs. 12,36,139 is hereby disallow under section 43B of the Income-tax Act, 1961, and the same is added back in the income of the assessee for the period under, consideration.
(3.) An appeal was filed by the assessee which appeal was partly allowed and relief of Rs. 12,36,139 which were claimed by the assessee as payment towards the contribution in P.F. and E.S.I. have been accepted. The Department filed an appeal before the Income-tax Appellate Tribunal which was dismissed by order dated January 11, 2008.;