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TMI Blog2013 (9) TMI 1174X X X X Extracts X X X X X X X X Extracts X X X X ..... mmon order. 2. Briefly stated, the facts emerging from appeal in ITA No. 47/Jodh/2013 for A.Y. 2008-09 are that the assessee is a limited cooperative Bank who carries out business of banking and follows mercantile system of accounting. For A.Y. 2008-09 this Bank filed its Return of Income [ROI] on 30/09/2008, declaring total income of ₹ 1,62,92,940/-. During the assessment proceedings, from the computation of total income it was noticed that the assessee has claimed provisions for gratuity of ₹ 1,38,790/-, provision for salary settlement of ₹ 11,00,000/- and provision for Vetan Suraksha Kosh of ₹ 8,11,865/-. The A.O. has found all the above provision as not allowable. Therefore, he has disallowed them and has adde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld. AR that the disallowance of provision for salary settlement on the ground that this is not an ascertained liability and this liability does not pertain to the year in question, is not justified. According to her, salary is not an item similar to items mentioned in the section 43B of the Act wherein the provision is allowable only on payment basis. She argued that the assessee has been following mercantile system of accounting and as per AS-I, all incomes and expenses would have to be recognized on accrual basis. She stated that the liability is crystallized in the year of approval. 2.4 Per contra, ld. DR relied on the orders of the authorities below and reiterated the same reasons as were given by them for disallowing this provision. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction of this provision. The assessee ' contributed to the Group Gratuity Scheme, under the Master Policy, which is duly approved gratuity fund under the policy issued by the LIC, created for the exclusive benefit of the employees and is an irrecoverable trust. The A.O. has disallowed for want of approval of CIT. The ld. CIT(A) has also confirmed this disallowance. 3.1 It was argued by ld. AR that the assessee has satisfied the requisite conditions to avail this deduction. However, ld. DR has opposed the stand taken by ld. AR and has supported the appellate order. 3.2 After hearing both sides, we have found that this issue stands squarely covered by the decision of Hon ble Apex Court rendered in the case of CIT Vs. Textlool C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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