TaxTMI 
TaxTMI 
2020 (4) TMI 583
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....o gratuity fund u/s.36(1)(v) amounting to Rs. 4,23,004/- for the reason that the gratuity fund was unapproved by the Learned Pr. CIT. The I.T Authorities ought to have appreciated that the appellant has applied for approval of the Gratuity Fund Scheme on 14th August 2008 and got approval from the learned Pr. CIT on 6th March, 2017 and delay was not attributable to the appellant. 2. The learned AO as well as the Ld. CIT(A)-8, Pune ought to have appreciated that payment made to gratuity fund cannot be denied simply because there was delay on part of concern authority in provision of statutory approval required under the IT Act, 1961 though application for approval was made well within time. 3. Alternative and without prejudi....
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..... Further, it for appellant to demonstrate before PCIT that even in FY 2012-12 the appellant has complied with provisions of section 2(5) of the IT Act 1961. Under these circumstances ground No.1 of the appeal is dismissed." On the basis of the order of the Ld. CIT(Appeals), the Ld. AR of the assessee submitted that the assessee has applied for approval to the Pr. CIT on 14.08.2008. However, the same was approved by Pr CIT only on 06.03.2017. Despite acknowledging the decision of the Pr.CIT to this effect, the Ld. CIT(Appeals) has not allowed the claim of the assessee u/s.36(1)(iv) of the Income Tax Act, 1961 (hereinafter referred to as "the Act‟) as the order passed by the authority was w.e.f 06.03.2017 only . 2.1 The ....
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.... be construed strictly and nothing should be added or subtracted to the language employed in the section, yet a strict construction of a provision does not rule out the application of the principles of reasonable construction to give effect to the purpose and intention of any particular provision of the Act. (See: Shri Sajjan Mills Ltd. Vs. CIT, M.P. & Anr., [1985] 156 ITR 585). From a bare a reading of section 36(1)(v) of the Act, it is manifest that the real intention behind the provision is that the employer should not have any control over the funds of the irrevocable trust created exclusively for the benefit of the employees. In the instant case, it is evident from the findings recorded by the Commissioner and affirmed by the ....
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....tuity of the employees, the same has never been disallowed by the department in the earlier assessment year as well as in the subsequent AY i.e. 2005-06. Though principles are resjudicata does not apply to a taxing statute but nevertheless rule of consistency is also required to be maintained. In the aforesaid view of the matter, we hold that the payment of Rs. 1,82,22,000/- to LIC towards gratuity of the employees is an allowable deduction and accordingly direct the Assessing Officer to allow the same. The ground raised by the assessee is allowed." 2.2 During the course of argument, the Ld. AR of the assessee has also drawn our attention to the decisions of Hon'ble Rajasthan High Court in the matter of Commissioner of Income Tax Vs. Jai....
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....In our opinion, once the application filed by the assessee was fully completed in accordance with law and then the approval should have been granted by the Ld. Pr. CIT with a reasonable period of time. However, in the present case, Ld. Pr. CIT has taken almost 9 years to grant approval, in our view by any stretch of reasoning, the time taken for granting the approval cannot be justified by the Revenue. Further, we are of the opinion that lapse/delay on the part of the Pr.CIT for not deciding the approval application of the assessee within a stipulated period of time, cannot be the ground for not allowing the claim of deduction u/s.36(1)(v) of the Act to the assessee. The assessee should not suffer loss on account of inaction and lethargi....