Contribution Towards ESI and PF are Deposited Before the Due Date Under Section 139(1). So No Disallowance Should Occur in Assessment: Jodhpur ITAT

In the case of U and T Tractor Spares Private Limited Jodhpur, the Jodhpur ITAT has held that the employees’s contribution amounting to Rs 425,722/- towards ESI and PF which have been collected by the assessee from its employees have been deposited well before the due date of filing of return of income u/s 139(1) of the Act. Therefore, our findings and directions contained in ITA No. 05/JODH/2021 shall apply mutatis mutandis to this appeal.

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he appeal filed by the assessee thus stand allowed.

Case Description:

During the course of hearing, the ld. AR, Mohit Soni submitted that the assessee is a partnership firm and during the year under consideration, the assessee derives income from execution of contract work and filed its return of income declaring an income of Rs. 2,71,15,850/-. The Central Processing Centre (CPC), Bangalore processed its return of income and passed an order u/s 143(1) in which it has made an adjustment by disallowing deduction of Rs. 4,38,530/- in respect of employees’s contribution of ESI & PF u/s 36(1)(va) without providing any opportunity and without following binding decision of Hon’ble Jurisdictional High Court which supported the claim made by assessee.

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