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Disallowance u/s 36(1)(va) of the Act of delayed deposit of ESI & Employees Provident Fund Contribution


Court :
ITAT Hyderabad

Brief :
This is assessee�s appeal for the A.Y 2019-20 against the order, dated 10.12.2019 passed by the National Faceless Appeal Centre (NFAC), New Delhi in the appeal filed by the assessee before the CIT (A)- 9, Hyderabad.

Citation :
ITA No.293/Hyd/2021

Hyderabad SMC Bench, Hyderabad
(Through Video Conferencing)
Before Smt. P. Madhavi Devi, Judicial Member
ITA No.293/Hyd/2021
Assessment Year: 2019-20
Shri Satish Kumar Sinha



Income Tax Officer
Ward 4(1)


Assessee by: Smt. C.S.Sree Lekha
Revenue by: Sri Waseem-ur-Rehman,DR
Date of hearing: 02/08/2021
Date of pronouncement: 23/08/2021


The only issue in this appeal is the disallowance u/s 36(1)(va) of the Act of delayed deposit of ESI & Employees Provident Fund Contribution. I find that that the A.Y before the Tribunal is 2019- 20 and by way of Finance Act of 2021, Explanation (v) to section 43B of the Act was introduced and it is clarified therein that the Employees Contribution to the P.F and ESI deposited by the employer after the due date is not allowable. This issue was considered by this Tribunal in the case of Late Smt. Anjali Devi Majeti (Rep. by L/R Majeti Nagaraju) Hyderabad vs. Income Tax Officer in ITA No. 95/Hyd/2020 dated 19.5.2021 and it has been held that the amendment is applicable prospectively.

2. Respectfully following the same, I hold that since the assessee has deposited the Employees Contribution to the PF and ESI before the date of filing the return of income, as per the amended provision applicable to the relevant A.Y, the same is not to be disallowed. Assessee’s appeal is accordingly allowed.

3. In the result, assessee’s appeal is allowed.
Order pronounced in the Open Court on 23rd August, 2021.

Please find attached the enclosed file for the full judgement


Poojitha Raam
on 28 August 2021
Published in Income Tax
Views : 34
Attached File : 1442821_4284_18.pdf
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