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Petitioner: COMMISSIONER OF INCOME-TAX VS Respondent: PETROLEUM AND MINERALS P. LTD.
1992 P T D 1070
1992 P T D 1070
[Bombay High Court (India)]
[187 I T R 560]
Before S.P. Bharucha and T.D. Sugla, JJ
COMMISSIONER OF INCOME-TAX
versus
PETROLEUM AND MINERALS P. LTD.
Income-tax Reference No.336 of 1976, decided on 20th December, 1988
Income-tax--
----Business expenditure----Remuneration to employees ---Gratuity---Assessee not having approved gratuity fund---Gratuity liability not deductible.
Held, that since the assessee did not have an approved gratuity fund, the assessee's gratuity liability was not deductible as business expenditure.
Shree Saban Mills Ltd'v. CIT [1985] 156 ITR 585 (SC) fol.
Dr. V. Balasubramanian with S.V. Naik and K.C Sidhwa, Advocates for the Commissioner.
V.J. Pandit and I.V. Pandit Advocates for the Assessee.
JUDGMENT
S.P. BHARUCHA, J.---The only question to be considered at the instance of the Revenue reads thus:
"Whether on .the facts and in the circumstances of the case, the Tribunal was right in allowing the assessee's claim for gratuity liability of Rs.77,760 notwithstanding the fact that the assessee did not have an approved gratuity fund under the Income Tax Act, 1961?"
Counsel are agreed that the question must be answered in the negative and in favour of the Revenue in the light of the judgment of the Supreme Court in Shree Sajjan Mills Ltd. v. CIT (1985) 156 ITR 585.
The question is so answered,
No order as to costs.
M.BA./1581/T Reference answered