Approved gratuity funds-Rule 101 of the Income-tax Rules, 1962 - Income Tax - 482/1987

Approved gratuity funds-Rule 101 of the Income-tax Rules, 1962 Circular No. 482 Dated 26/3/1987 To All the Chief Commissioners of Income-tax/ Commissioners of Income-tax. Dear Sir, Subject: Approved gratuity funds-Rule 101 of the Income-tax Rules, 1962. The Government has notified in the Offical Gazette dated March 9, 1987, the Income-tax (Second Amendment) Rules, 1987*. The said Amendment Rules amend the provisions of rule 101 of the Income-tax Rules, 1962, with effect from April 1, 1987. 2. Under the existing provisions of rule 101 of the Income-tax Rules, 1962, monies contributed to approved gratuity funds are required to be deposited in a Post Office Savings Bank Account or a current account with any scheduled bank, or are required to be utilised for the purpose of making contributions under Group Gratuity Scheme entered into with the Life Insurance Corporation of India. To the extent such monies are not so deposited or utilised, they are required to be invested in the modes of investment specified in rule 67(2) of the Income-tax Rules, 1962. 3. Under the amended provisions, the contributions received by any approved gratuity fund on or after April 1, 1987, will be required to be deposited in a Post Office Savings Bank Account or in a current account with any scheduled bank or will be required to be utilised for the purpose of making contributions under Group Gratuity Scheme entered into with the Life Insurance Corporation of India. The contributions will not be permitted to be deposited in any of the modes of investment specified in rule 67(2) of the Income-tax Rules. 4. The amended provisions may be brought to the notice of the officers working in your charge. (Sd.) V.D. Wakharkar, Director (TPL-II).