2021 (3) TMI 75

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tion.   3 Without prejudice to Ground Nos.1 and 2, both the lower authorities erred in disallowing deduction in respect of the Appellants' contribution to the Employees' Superannuation Fund of Rs. 21,01,654/- u/s. 37(1) r.w.s. 43B.   4 Without prejudice to Ground Nos.1 to 3, both the lower authorities failed to appreciate that an assessee should not be made to suffer for inaction by the Income-tax department.   5 Both the lower authorities erred in disallowing the Appellant's contribution to Employees' Gratuity Fund of Rs. 21,84,256/- u/s 40A(7). Rs. 7,08,682/- (Inclusive of Surcharge @5% and Cess @3%) 6 The Assessing Officer erred in holding that the Appellant's contribution to Employees' Gratuity Fund of Rs. 21,84,256/- was merely a provision for employees' gratuity.   7 Without prejudice to Ground Nos.5 and 6, both the lower authorities erred in disallowing deduction in respect of the Appellants' contribution to Employees' Gratuity Fund of Rs. 21,84,256/- u/s 37(1) r.w.s. 43B.   8 Without prejudice to Ground Nos.5 to 7, both the lower authorities failed to appreciate that an assessee shou....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....2010. Reliance was placed on the following judgments in support of the claim:- CIT vs Textool Co Ltd (2013) 216 TAXMAN 0327 (SC) CIT vs Jaipur Thar Gramin Bank (2016) 388 ITR 228 (Raj) Pr CIT vs. Rajasthan State Seed Corporation Ltd (2016) 386 ITR 267 (Raj) Prakash Software Solution (P) Ltd. Vs ITO (2019) 191 TTJ 64 (Ahmedabad ITAT) Bilagi Pattana Sahakari Bank Niyamit vs. CIT (ITA No. 173/Bang/2012) (Bangalore ITAT) Sri Basaveshwara Co-Op Bank and Others vs. CIT (Bangalore ITAT) ACIT vs. Verizon Data Services India (P.) Ltd. [2015] 43 ITR(T) 436 (Chennai - Trib.) Capital IQ Information System (India) (P.) Ltd. vs. Addl. CIT [2014] 49 taxmann.com 313 (Hyd. - Trib.) DCIT vs. Cornwall Overseas Delhi ITAT [2019] 110 taxmann.com 8 (Delhi - Trib.) Dy. CIT vs. Baroda Gujarat Grameen Bank (ITA No. 1479/Ahd/2010] (Ahmedabad ITAT) The District Co - Op Central Bank Eluru vs. ITO (ITA No. 49& 50/Vizag/2012) (Vizag ITAT) Cranedge India Pvt Ltd vs. DCIT (ITA No. 555/PUN/2017)(Pune ITAT) Maass Flange India Pvt Ltd vs. DCIT (ITA No. 1382/PUN/2019)(Pune ITAT) Chief Commissioner(Admn) vs. Karnataka Electricity Board (1992) 197 ITR 48 (Kar HC) 6. At the tim....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....bad Bench while deciding the issue on similar facts held as under: 8. We have heard the arguments of the parties, perused the material on record and have gone through the orders of the authorities below. We find that the issue is squarely covered by the decision of the ITAT, Hyderabad in the case of M/s. Sri Krishna Drugs Ltd. Vs. Department of Income-tax in ITA No.2126/Hyd/2011 for AY 2007.08 dated 11.4.2012, where the JM was one of the party. The Tribunal in the said case held as follows: 3. The second ground raised by the Revenue is as under: "The learned CIT(A) erred in holding that unrecognised gratuity fund is allowable u/s. 37(1),when the case is hit by the provisions of section 40A(9) and especially when the assessee failed to comply with the provisions of section 36(1)(v)." 4. After hearing both the sides, we find this issue is covered in favour of the assessee and against the Revenue in I.T.A. No. 198/Hyd/2011 in assessee's own case for A.Y. 2006-07 order dated 16.12.2011 wherein this Tribunal held as follows: "3. After hearing both the parties, we are of the opinion that similar issue came up for consideration in assessee's own case for assessment yea....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....deducted under sec. 37 of the I.T. Act, though not under sec. 36(1)(v). In view of this judgment of the jurisdictional High Court, in our opinion, even if any payment is made to an unapproved gratuity fund, it has to be allowed under sec. 37. By respectfully following the binding judgement of Andhra ITA No.49, 50,78, 476/Vizag/2012, 515, 524/Vizag/2014, 269/Vizag/2015 & CO 33/Vizag/2013 & CO 29/Vizag/2015 M/s. The District Co-operative Central Bank Ltd., Eluru Pradesh High Court in the case of warner Hindustan Ltd. (supra), we uphold the order of the CIT(A). In view of the above discussion, we dismiss the ground taken by the Revenue." 5. In view of the above decision of this Tribunal, the ground raised by the Revenue is dismissed." 9. Since the issue under consideration is materially identical to the one decided by the ITAT in the case of M/s. Sri Krishna Drugs Ltd. (supra), respectfully following the same, we set aside the order of the CIT(A) and allow the ground of appeal of the assessee." 9. Similarly, ITAT Ahmedabad Bench in the case of Baroda Gujarat Grameen Bank cited (supra) held that the payment made to LIC of India is not a provision but it is actual expenditur....