TaxTMI 
TaxTMI 
APPROVED PROVIDENT FUNDS, APPROVED SUPERANNUATION FUNDS, APPROVED GRATUITY FUNDS
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....ss the Commissioner otherwise directs, be affected by the fact that the fund is subsequently amalgamated with another provident fund on the occurrence of an amalgamation of these undertakings in connection with which the two funds are maintained, or that it subsequently absorbs the whole or a part of another provident fund belonging to any undertaking which is wholly or in part transferred to or merged in the undertaking of the employer maintaining the first-mentioned fund. Conditions to be satisfied by approved provident funds. 3. In order that a provident fund may receive and retain approval, it shall, subject to the provisions of paragraph 4, satisfy the conditions set out below and any other conditions which the Board may, by rules, specify— (a) all employees shall be employed in India, or shall be employed by an employer whose principal place of business is in India; (b) the contributions of an employee in any year shall be a definite proportion of his salary for that year, and shall be deducted by the employer from the employee's salary in that proportion, at each periodical payment of such salar....
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....ay, if he thinks fit, and subject to such conditions, if any, as he thinks proper to attach to the approval, accord approval to a fund maintained by an employer whose principal place of business is not in India, provided the proportion of employees employed outside India does not exceed ten per cent. (2) Notwithstanding anything contained in clause (b) of paragraph 3, an employee who retains his employment while serving in the armed forces of the Union or when taken into or employed in the national service under any law for the time being in force, may, whether he receives from the employer any salary or not, contribute to the fund during his service in the armed forces of the union or while so taken into or employed in the national service a sum not exceeding the amount he would have contributed had he continued to serve the employer. (3) Notwithstanding anything contained in clause (e) or clause (h) of paragraph 3 — (a) at the request made in writing by the employee who ceases to be an employee of the employer maintaining the fund, the trustees of the fund may consent to retain the whole or any part of the accumulated ....
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....is allowed at a rate exceeding the rate as may be fixed by the Central Government by notification in this behalf shall be deemed to have been received by the employee in that financial year and shall be included in total income for that financial year, and shall be liable to income-tax. Exemption for employee's contribution. 6. An employee participating in an approved provident fund shall, in respect of his own contributions to his individual account in the fund in the financial year, be entitled to a deduction in the computation of his total income of an amount determined in accordance with section 69. Exclusion from total income of accumulated balance. 7. (1) The accumulated balance due and becoming payable to an employee participating in an approved provident fund shall be excluded from the computation of his total income— (a) if he has rendered continuous service with his employer for a period of five years or more; (b) if, though he has not rendered such continuous service, the service has been terminated by reason of the employee's ill-health, or by the contraction of discontin....
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....ovident fund with existing balances, an account shall be made of the fund up to the day immediately preceding the day on which the approval takes effect, showing the balance to the credit of each employee on such day, and containing such further particulars as the Board may prescribe. (2) The account shall also show in respect of the balance to the credit of each employee the amount thereof which is to be transferred to that employee's account in the approved provident fund, and such amount (hereinafter called his transferred balance) shall be shown as the balance to his credit in the approved provident fund on the date on which the approval of the fund takes effect, and sub-paragraph (4) of this paragraph and subparagraph (5) of paragraph 4 shall apply thereto. (3) Any portion of the balance to the credit of an employee in the existing fund which is not transferred to the approved fund shall be excluded from the accounts of the approved fund and shall be liable to income-tax in accordance with the provisions of this Code, other than this Part. (4) Subject to such rules as the Board may make in this behalf, the Assessing Officer shall....
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.... portion of such balance as represents his share in the amount so transferred to the trustees (without addition of interest, and exclusive of the employee's contributions and interest thereon) shall, if the employer has made effective arrangements to secure that tax shall be deducted at source from the amount of such share when paid to the employee, be deemed to be an expenditure by the employer within the meaning of section 35 incurred in the financial year in which the accumulated balance due to the employee is paid. Funds deemed to be approved. 14. The provisions of provisions of paragraphs 2 to 13 shall not apply to a provident fund established under a schme framed under the following, namely:— (i) the Provident Funds Act, 1925; (ii) the Public Provident Fund Act, 1968; (iii) the Employees Provident Funds and Miscellaneous Provisions Act, 1952; (iv) the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948 and such provident fund shal be deemed to be an approved provident fund if it is notifi....
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....p; (d) "balance to the credit of an employee" means the total amount to the credit of his individual account in provident fund at any time; (e) "annual accretion" in relation to the balance to the credit of an employee, means the increase to such balance in any year, arising from contributions and interest; (f) "accumulated balance due to an employee" means the balance to his credit, or such portion thereof as may be claimable by him under the regulations of the fund, on the day he ceases to be an employee of the employer maintaining the fund; (g) "regulations of a fund" means the special body of regulations governing the constitution and administration of a particular provident fund; and (h) "salary" includes dearness allowance, if the terms of employment so provide, but excludes all other allowances and perquisites. PART-II APPROVED SUPERANNUATION FUNDS Approval of superannuation fund and its withdrawal. 1. (1) The Commissioner may accord approval to any superannuation fund or any part of a sup....
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....en in existence during any year or years prior to the financial year in which the application for approval is made, also two copies of the accounts of the fund relating to such prior year or years (not being more than three years immediately preceding the year in which the said application is made) for which such account have been made up, but the Commissioner may require such further information to be supplied as he thinks proper. (2) If any alternation in the rules, constitution, objects or conditions of the fund is made at any time after the date of the application for approval, the trustees of the fund shall forthwith communicate such alteration to the Assessing Officer mentioned in sub-paragraph (1), and in default of such communication any approval given shall, unless the Commissioner otherwise orders, be deemed to have been withdrawn from the date on which the alteration took effect. Contribution by employer, when deemed to be income of employer. 4. Where any contributions by an employer (including the interest thereon, if any) are repaid to the employer, the amount so repaid shall be deemed for the purpose of income-tax to be the income of th....
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.... particulars or information, as the Assessing Officer may require. Provision relating to rules. 10. (1) The Board may, for the purposes of this Part, prescribe— (a) the statements and other information to be submitted along with an application for approval; (b) the returns, statements, particulars, or information which the Assessing Officer may require from the trustees of an approved superannuation fund or from the employer; (c) limiting the ordinary annual contribution and any other contributions to an approved superannuation fund by an employer; (d) regulating the investment or deposit of the moneys of an approved superannuation fund; (e) providing for the assessment by way of penalty of any consideration received by an employee for any assignment of, or creation of a charge upon, his beneficial interest in an approved superannuation fund; (f) determining the extent to, and the manner in, w....
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....nbsp; (b) the fund shall have for its sole purpose the provision of gratuity to employees in the trade or undertaking, on their retirement at or after a specified age or on their becoming incapacitated prior to such retirement or on termination of their employment after a minimum period of service specified in the rules of the fund, or to the widow, children or dependants of such employees on their death; (c) the employer in the trade or undertaking shall be a contributor to the fund; and (d) all benefits granted by the fund shall be payable only in India. Application for approval. 3. (1) An application for approval of a gratuity fund shall be made in writing by the trustees of the fund to the Assessing Officer by whom the employer is assessable and shall be accompanied by a copy of the instrument under which the fund is established and by two copies of the rules and, where the fund has been in existence during any year or years prior to the financial year in which the application for approval is made, also two copies of the accounts of the fund relating to such prior year or years (not being more than three years i....