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TMI Blog1999 (3) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... oncerned with reads thus : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in confirming the order of the Commissioner of Income-tax (Appeals) that the entire initial contribution made to the superannuation fund is allowable deduction ?" The High Court declined to call for its reference and the Revenue is in appeal. The High Court relied upon its earlier judgment in the case of CIT v. Hyderabad Asbestos Cement Products Ltd. [1988] 172 ITR 762 (AP). The Revenue had filed a special leave petition against this judgment but it was dismissed on the ground of undue delay. The facts of these appeals are similar. The facts now set out are of Civil Appeal No. 2398 of 1994. The assessee had in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ident funds and approved superannuation funds. Section 36(1)(iv) reads thus : "Section 36. (1) The deductions provided for in the following clauses shall be allowed in respect of the matters dealt with therein, in computing the income referred to in section 28.... (iv) any sum paid by the assessee as an employer by way of contribution towards a recognised provident fund or an approved superannuation fund, subject to such limits as may be prescribed for the purpose of recognising the provident fund or approving the superannuation fund, as the case may be ; and subject to such conditions as the Board may think fit to specify in cases where the contributions are not in the nature of annual contributions of fixed amounts or annual contribut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urposes of deduction of certain contributions : In exercise of the powers conferred by clause (iv) of sub-section (1) of section 36 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby specifies the following conditions for the deduction of contributions, not being annual contributions of fixed amounts or annual contributions fixed on some definite basis by reference to the income chargeable under the head 'Salaries' or to the contributions or to the number of members of the fund, namely : 1. The total amount of contribution that shall be taken into account for the purposes of this notification shall not exceed twenty-five per cent. of the employee's salary for each year of his past service with the employe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d amounts or annual contributions fixed on some definite basis by reference to the income chargeable under the head "Salaries" or to the contributions or to the number of members of the fund. The contributions in the instant case were not payments for recognition or approval and, therefore, outside the limits that could be prescribed under clause (iv) in that behalf. It is arguable that the contributions made here are annual contributions of fixed amounts but, for the purposes of these appeals, we will proceed on the basis that they are not and that the Board was, therefore, entitled to make conditions that would apply. Even so, the question is whether the conditions which were laid down in the said notification fall outside the power o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s year in which the amount was paid. This too is no "condition" but a provision super-added to the section which does not contemplate any such distribution of the deduction. Under the section, the deduction is available in the assessment year relating to the previous year in which the payment was made and it must be so granted. We think, in the circumstances, that the view taken by the Andhra Pradesh High Court in the case of CIT v. Hyderabad Asbestos Cement Products Ltd. [1988] 172 ITR 762, is substantially correct. We use the qualifying word "substantially" because it has not been necessary for us in these proceedings to go into the correctness of its view that the Board could not have required actual payment of the contribution. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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