1993 (10) TMI 5

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..... the Revenue, the Income-tax Appellate Tribunal has referred the following two questions for our opinion under section 256(1) of the Income-tax Act, 1961 : " (1) Whether, on the facts and in the circumstances of the case, the admissible amount would be the amount not exceeding 8-1/3 per cent. of the salary of the employees for each year of service including the current year and the previous year .....

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..... reason, to the extent such amount does not exceed an amount calculated at the rate of eight and one-third per cent. of the salary (as defined in clause (h) of rule 2 of Part A of the Fourth Schedule) of each employee entitled to the payment of such gratuity for each year of his service in respect of which such provision is made." (emphasis added). From the aforesaid Explanation, it can be said t .....

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..... o is in service for three years provision for gratuity is made by the employer. In that case, the employer has to take into account salary for the relevant three years and on the basis of the Explanation he can make provision to the extent that such amount does not exceed an amount calculated at the rate of eight and one-third per cent. of the salary for each year of his service in respect of whic .....

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