Case Law Details
Andaman & Nicobar State Corporation Bank Ltd. Vs DCIT (ITAT Kolkata)
ITAT noted that in this case, the assessee neither exercised any control or influence over the management of the funds nor did it have any say in the matters relating to payments of the benefits arising or accruing there from which was due to the Members/ Employees. So by relying on the ratio of the Hon’ble Supreme Court in CIT vs. Text Tool (supra) wherein it was held that, the intention of Section 36(1)(v) of the Act, is that the employer should not have control over the funds of the irrevocable trust created exclusively for the benefit of the employees of the assessee and the Hon’ble Allahabad High Court decision in M/s Scooters India Ltd. (supra) which decision is on identical issue, we hold that the assessee is entitled for the deduction of the payments made to LIC towards the group gratuity scheme, so we are inclined to allow the claim of the assessee. Accordingly, we set aside the orders of the lower authorities and allow the appeal of the assessee. However, the AO is directed to verify the actual payment made by the assessee towards the gratuity scheme to LIC of India since there is confusion in the order of Ld. CIT(A) on this issue. With the aforesaid observation, the claim of the assessee is allowed.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
This is an appeal preferred by the assessee against the order of Ld. CIT(A)-1, Kolkata dated 29.11.2019 for AY 2014-15.
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