2010 (8) TMI 1082

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....y Ms. Urvashi Shodhan, AR O R D E R PER BHAVNESH SAINI:   This appeal by the Revenue is directed against the order of the CIT(A)-VI, Baroda dated 08-01-2010 for assessment year 2006-07 on the following ground: "1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the disallowance of contribution made to group gratuity scheme o....

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....ssions were made before the leaned CIT(A). The learned CIT(A) considering the order of ITAT Ahmedabad Bench in the case of Crystal Solvent Pvt. Ltd. (ITA No.655/Ahd/2005) allowed the appeal of the assessee in which it was held that disallowance u/s 40 A(7) of the IT Act cannot be made on the ground of absence of approval of gratuity fund as the deduction was not claimed on account of any provision....

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..... Section 40A (7) of the IT Act provides that subject to provision of clause (b), no deduction shall be allowed in respect of any provision made by the assessee for payment of gratuity to his employer on their retirement or on termination of their employment for any reason. It is clear from the above provision that section 40A (7) of the IT Act would apply in respect of the provision only. However....

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.... been disallowed if it had been proved that gratuity, in respect of which said payment had been made, had not become payable during previous year - Held, yes - Whether in absence of such a case made out by revenue, Tribunal was right in holding that grant of approval of gratuity fund was not relevant for purpose of instant case as said deduction was not being claimed on account of any provision an....