1996 (11) TMI 29

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... circumstances of the case and having regard to rule 104 of the Income-tax Rules, 1962, read with section 36(1)(v) of the Income-tax Act, 1961, the Appellate Tribunal was right in holding that the sum of Rs. 65,499 representing the difference between the actual payment made to the approved gratuity fund towards initial contribution and the actuarial liability for the same should be allowed as a deduction while computing the income of the assessee for the assessment year 1973-74 ?" The assessee is a company in which the public are not substantially interested. At the time of completion of the original assessment of the assessee relating to the assessment year 1973-74, the assessee made a claim of Rs. 1,93,756 being the initial contributio....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e-tax Rules, which restricts the quantum of the initial contribution to be made to an approved fund, would have application only with reference to the approval to be given to the gratuity fund and that once approval is given to the fund, there is no need to restrict the claim in terms of rule 104 while allowing the same under section 36(1)(v) of the Act. Thereupon, the Department preferred an appeal to the Tribunal. The Tribunal held that its earlier understanding of the point in dispute, viz., that the claim of the assessee fell within the ambit of section 40A(7) of the Act was wrong. It further held that the initial contribution made by the assessee was found by the Commissioner of Income-tax (Appeals) to be within the limits prescribe....