Tuesday, 17 December 2013

No disallowance u/s 43B if amount is deposited within the grace period:

AO made disallowance u/s 43B in respect of employees’ contribution to PF considering the said payment to be belated since the same was deposited after the due date prescribed under the PF Act. The said disallowance was deleted by CIT(A) as well as ITAT consequent to which revenue preferred an appeal before the Hon’ble High Court. Hon’ble High Court observed that the ITAT had deleted the said disallowance on the count that the said assessee had deposited the said sum within the extended grace period under the PF Act. It was held that since the assessee was entitled to make the said payment under PF Act within the grace period and since the assessee had made the said payment within such grace period, it cannot be said that the assessee had not deposited the amount within the prescribed time limit. Accordingly, Revenue’s appeal was dismissed.

[CIT vs. Amoli Organics (P) Ltd. – Tax Appeal No.36 of 2008]

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