https://www.taxtmi.com/caselaws?id=70146 A gratuity provision made on actuarial valuation was deductible under section 40A(7)(b)(ii) because it satisfied the statutory conditions and did not exceed the admissible limit. The provision was allowable in the year it was created, as Explanation 2 permits deduction on provision basis without awaiting actual payment. The distinction between initial liability and incremental liability was held irrelevant once the provision fell within the saving clause. Accordingly, the full admissible gratuity provision was treated as deductible in computing business income. en-us Fri, 10 Apr 1981 00:00:00 +0530 Thu, 14 Apr 2011 15:45:26 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=70146 A gratuity provision made on actuarial valuation was deductible under section 40A(7)(b)(ii) because it satisfied the statutory conditions and did not exceed the admissible limit. The provision was allowable in the year it was created, as Explanation 2 permits deduction on provision basis without awaiting actual payment. The distinction between initial liability and incremental liability was held irrelevant once the provision fell within the saving clause. Accordingly, the full admissible gratuity provision was treated as deductible in computing business income. Case-Laws Income Tax Fri, 10 Apr 1981 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=70146