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2016 (9) TMI 1210 - AT - Income TaxPayment made to LIC towards Group Gratuity Scheme disallowable U/s 40A(7) - Held that:- It is, though, disputed that the application of the assessee for grant of approval, was not traceable in the office of the revenue but the assessee was able to produce the stamped copy of the application and the letter supporting the application dated 13/5/1996 before the Bench. It is also an admitted position that the LIC vide letter dated 16th May, 1996 has requested the revenue to grant approval. In our view, once the third party i.e. LIC is requesting the revenue to grant approval to the fund created for the benefit of the employees in the form of approval of gratuity fund then the revenue cannot dispute that the assessee has not filed application for grant of approval of the gratuity fund. Moreover, in our view, once the revenue is accepting the status of the assessee being approved gratuity fund and has been extended the benefit of the approved gratuity fund after the application was initially filed on 13/5/1996, Now the revenue cannot deny the benefit merely on the basis of non-grant of the approval by the authorities. For the non action of the revenue, the assessee cannot be denied with the benefit of the pendency of the deduction on account of the above contribution made to the gratuity fund. - Decided in favour of assessee.
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