TaxTMI 
TaxTMI 
1982 (6) TMI 171
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....tuity payable in a letter dt. 6th January, 1976 addressed to the ITO: Rs. Provision for 1973 5,94,302 Actual payment made during 1973 1,51,405 Provision for gratuity for 1970 and earlier years 20,33,741 27,79,448 The assessee had set up a gratuity fund which was recognised by the CIT on 12th August 1976 w.e.f. 15th December, 1975. There was therefore no recognised fund as at the end of the accounting year. The ITO allowed the entire claim in the original assessment, to the extent of Rs. 27,79,448. Subsequent to the assessment, the audit took the view that the amount of Rs. 20,33,741 was wrongly allowed as the terms of s. 40A(7)(b)(ii) has not been complied with. It was also pointed out that an amount of Rs. 7,71,907 being the incre....
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....apital gains assessable in assessee's hands. If this order is taken as one setting aside the entire assessment, the assessee would have no case on the question of jurisdiction, since the order u/s 263 has become final against the assessee. We would, however, assume that the assessment is not entirely set aside, as the order u/s 263 was concerned only with one issue. In other words, we will assume that the order is coverable into two parts, one is pursuance of order u/s 263 and the other u/s 148. The audit note one the gratuity reads as under : "Out of gratuity of Rs. 27,79,448 claimed in account, only an amount of Rs. 5,94,302 was disallowed u/s 40A(7) as relating to the year under consideration (and the same has been allowed subsequently ....
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....yr. 1971-72 be the AAC. It is claimed that the order of the AAC on the basis of which the double allowance is alleged was under appeal at the instance of the revenue before this Tribunal as on the date of the audit note i.e. 12th September 1977, though the Tribunal subsequently confirmed the order of the AAC. This, according to us, would make no difference as to the correctness of the fact pointed out by the audit. We are of the view that this one fact that the amount of Rs.7,71,907 has already been allowed by an earlier order has to be taken as information which justifies jurisdiction u/s 147(b). As pointed out by the ld. Dept. Rep., the decision of the Supreme Court in the case of Indian and Eastern Newspapers Society vs. CIT (1979) 12 CT....