Business expenditure: Disallowance u/s. 43B(b) r/w.s. 36(va): Contribution to provident fund: Due date mentioned in section 36(va) is due date mentioned in section 43B(b): Contribution made after due date specified by Provident Fund Authority but before due date for filing return: Amount deductible:

The assessee employer, had deposited the employees’ contribution towards provident fund before the due date for filing of the return but after the due date specified by the Provident Fund Authority. The Assessing Officer disallowed the claim for deduction and treated the amount as income relying on the provisions of section 36(1)(va) of the Income-tax Act, 1961. The CIT(A) and the Tribunal allowed the assessee’s claim.

On appeal, the Revenue contended that in view of section 36(1)(va) r.w.s. 2(24)(x), such payment though made to the provident fund authorities, should be treated to be income of the assessee. The Gujarat High Court upheld the decision of the Tribunal and held as under:

“i) The due date as mentioned in section 36(1) (va) is the due date as mentioned in section 43B(b), i.e. payment/contribution made to the provident fund authority any time before filing the return for the year in which the liability to pay accrued along with the evidence to establish the payment thereof.

ii) The Assessing Officer proceeded on the basis that “due date” as mentioned in section 36(1) (va) is the due date fixed by the provident fund authority, whereas in the matter of culling out the meaning of the word “due date”, as mentioned in the section, the Assessing Officer was required to take note of section 43B(b) and by not taking the note of the provisions contained therein committed a gross error, which was correctly rectified by the Commissioner (Appeals) and rightly confirmed by the Tribunal.

iii) The appeal fails and the same is dismissed.”