1980 (8) TMI 66

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....the assessee-company for the assessment year 1972-73 ? " The assessee was a foreign company carrying on insurance business in India. It was taken over by the Govt. of India with all its assets and liabilities with effect from January 1, 1973. The assessment year involved is 1972-73, the corresponding accounting period having ended on December 31, 1971. The total income was computed at Rs.21,42,130 after disallowing Rs. 1,79,413 provided in the accounts by way of " pension provision ". The assessee felt aggrieved and submitted an appeal before the AAC, regarding the disallowance of a sum of Rs. 1,31,279 in computing its total income for the relevant assessment year. The amount of Rs. 1,31,279 was the sum determined on actuarial valuati....

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....f annual contribution of 20% of expected future salaries. The corresponding figures for the earlier year are Rs. 8,67,968, Rs. 5,38,152 and Rs. 3,50,364 as reduced by Rs. 20,548, respectively, for discounted value of pensions to existing pensioners and the discounted value of prospective pensions to active staff and discounted value of annual contribution of 20% of expected future salaries. The difference between the two amounts of Rs. 9,99,247 and Rs. 8,67,968 has been claimed by the assessee for deduction during the relevant year. It is an admitted fact that there was no trust and the amount represented unfunded contribution." Thereafter, referring, to the relevant decisions, the Tribunal observed that, in the instant case before them,....