Law:

Section:

Section 43B of the Income-tax Act, 1961 - Business disallowance - Certain deductions to be allowed only on actual payment - Whether provident fund payment actually made during previous year but beyond due date is to be disallowed under section 43B - Held, yes Bajoria for the Appellant. ORDER 1. The only question formulated by the assessee for the purpose of agitating it in an appeal under section 260A is as follows : "Whether on a true and proper construction of the provisions of section 43B of the Income-tax Act, 1961, the Tribunal was justified in law in holding that provident fund payments actually made during the previous year but beyond the due date would have to be disallowed under the said provisions ?" 2. In the impugned order of the Tribunal passed on 31st January, 2002, it directed the assessee to place all its arguments in regard to provident fund contribution deductions before the Assessing Officer so far as the question of what constitutes "due date" was concerned. The Tribunal proceeded on the basis that as per the current law, contained in section 43B(b) and the further proviso appearing under that section, no discretion is left in regard to provident fund contributions to the Assessing Officer or the other Departmental authorities of the IT Department. 3. In case the due date for payment of provident fund contribution is gone, then and in that event, even if the contribution is made later on and even if such contribution is made to the full extent, deductions under the Income-tax Act are no longer claimable or permissible. 4. The above provisions of the Income-tax Act are set out below : "43B. Certain deductions to be only on actual payment.-Notwithstanding anything contained in any other provision of this Act, a deduction otherwise allowable under this Act in respect of. . . (b) any sum payable by the assessee as employer by way of contribution of any provident fund. . . . shall be allowed . . . . only in. . . . that previous year in which such sum is actually paid. . . . provided further that no deduction shall, in respect of any sum referred to in clause (b), be allowed unless such sum has actually been paid. . . . on or before the due date.…

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