Disallowance of ₹24.22 Lakh Towards ESI/PF u/s 36(1)(va): ITAT Condones Delay, Remands Matter to CPC for Verification [Read Order]
The Tribunal noted that the assessee had produced proof showing the payments were made within the due date, which the CIT(A) had not considered
![Disallowance of ₹24.22 Lakh Towards ESI/PF u/s 36(1)(va): ITAT Condones Delay, Remands Matter to CPC for Verification [Read Order]](https://images.taxscan.in/h-upload/2025/07/28/2070088-disallowance-disallowance-of-2422-lakh-towards-esi-pf-esi-pf-section-361va-taxscan.webp "Disallowance of ₹24.22 Lakh Towards ESI/PF u/s 36(1)(va): ITAT Condones Delay, Remands Matter to CPC for Verification [Read Order]")
The Lucknow Bench of Income Tax Appellate Tribunal ( ITAT ), condoned the delay in filing an appeal against a disallowance of ₹24.22 lakh towards Employees’ State Insurance/Provident Fund (ESI/PF) under Section 36(1)(va) of Income Tax Act,1961 and remanded the matter to the Centralized Processing Centre( CPC ) for verification. Veena Agarwal,petitioner-assessee,carried...
The Lucknow Bench of Income Tax Appellate Tribunal ( ITAT ), condoned the delay in filing an appeal against a disallowance of ₹24.22 lakh towards Employees’ State Insurance/Provident Fund (ESI/PF) under Section 36(1)(va) of Income Tax Act,1961 and remanded the matter to the Centralized Processing Centre( CPC ) for verification.
Veena Agarwal,petitioner-assessee,carried on the business of trading in clothes, suiting, and shirting under the name V.K. Enterprises. She had filed her return of income on 30/12/2020, declaring a total income of ₹4,34,39,040.
The return was processed under section 143(1) of the Act by the CPC on 29/11/2021, and the total income was determined at ₹4,59,32,212 after a disallowance of ₹24,22,448 under section 36(1)(va) based on details from Form 3CD.
Dissatisfied, she appealed before the Commissioner of Income Tax (Appeals)[CIT(A)], who dismissed the appeal. The assessee then took the matter to the ITAT.
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The Senior Departmental Representative,did not object to the request. Considering the circumstances of the case, the Tribunal condoned the delay and admitted the appeal for hearing.
The two member bench comprising Subhash Malguria (Judicial Member) and Anadee Nath Misshra (Accountant Member) observed that no one appeared for the assessee at the hearing. It heard the Departmental Representative and reviewed the records. The issue was that the CPC had disallowed ESI/PF payments, stating they were not made on time.
The assessee later provided proof during the appellate proceedings that the payments were made within the due date, but the CIT(A) had not considered it.
The appellate tribunal therefore set aside the CIT(A)’s order dated 10/05/2023 and sent the matter back to the CPC to verify the payments and pass a fresh order after giving the assessee an opportunity to be heard.
Accordingly the appeal was allowed for statistical purposes.
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