1982 (4) TMI 205

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....-79. The accounting year is the year ended 31-3-1978. The two points that arise are dealt with as follows: 2. Provision for gratuity---Disallowance of Rs. 18,599 - The assessee-company has an approved gratuity fund. The balance in the fund account as on 31-3-1978 is Rs. 3,34,842 whereas the liability for payment of gratuity as on 31-3-1978 as per actuarial valuation works out to Rs. 26,202. The....

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....4-1973 onwards and actuarial valuation for the assessment years commencing from 1-4-1976 onwards have become irrelevant. Those considerations have ceased to be of any significance. After the enactment of section 40A(7), if any provision for gratuity is allowed as a deduction it is not because of any contractual or statutory liability on the part of the assessee, but only because of a payment made ....

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....ves a provision made by the assessee for the purpose of payment of a sum by way of any contribution towards an approved gratuity fund or for the purpose of payment of any gratuity that has become payable during the previous year. The provision in dispute before us, is certainly not a provision for the purpose of payment of any gratuity that has become payable during the previous year. So the only ....

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....got to be allowed as a deduction. If such payments are not made within a reasonable period, it may cease to be such a provision. Therefore, this question has to be verified in the light of the payments of these amounts into the fund and the exact dates of payments. So the Commissioner (Appeals) will verify these dates of payments and the amounts of payments and decide the question whether this pro....