TMI Blog1998 (6) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... purported to have been issued by the Board in exercise of powers conferred on it under s. 14 and s. 36(1)(iv) of the Act and by which notification the deduction for the initial contribution paid to the superannuation fund by an employer was to be considered for deduction in the year of payment only to the extent of one-fifth of 80 per cent of the amount, 20 per cent of the amount was not to be allowed. Initial contribution was not to be allowed as a deduction in any year and the allowance of the 80 per cent was spread to be over period of five years at the rate of one-fifth of 80 per cent for five years commencing from the year of first payment. The Board had also specified yet another condition that the amount of contribution to be taken into account for the purposes of the notification was not to exceed 25 per cent of the employees salary for each year of his past service with the employer as reduced by the employer's contribution, if any to the provident fund in respect of the employees for each such year. 3. The Tribunal has held that the conditions specified with regard to the spread-over and the denial of any deduction in respect of 20 per cent of the initial contribution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its 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 contributions fixed on some definite basis by reference to the income chargeable under the head "Salaries" or to the contributions or to the numbers of members of the fund ......" This provision for the deduction of sums paid by the assessee as an employer by way of contribution to a recognised provident fund or an approved superannuation fund. The limits upto which the sums may be so paid is to be within such amount as may be prescribed for the purpose of recognising the provident fund or approving the superannuation fund. The reference to contribution in the opening part of s. 36(1)(iv) does not make any distinction as between annual contribution and initial contribution. The limits subject to which the contribution may be made are to be prescribed by the Rules. Sec. 2(23) of the Act defines the word "prescribed" as meaning prescribed by the rules made under the Act. The powe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... One-fifth of such deductible allowance shall be allowed in the assessment year relating to the previous year in which the amount was actually paid and the balance of the deductible allowance shall be allowed in equal instalments for each of the four immediately succeeding assessment year." 10. While condition No. 1 is in conformity with r. 87, the other two conditions Nos. 2 and 3 cannot be regarded as being within the scope of the power conferred on the Board by s. 36(1)(iv). As noticed earlier, the first part of s. 36(1)(iv) provides for a limit being placed on the amount of contribution whether initial or annual by rules framed under the Act. The rule framed being rr. 87 and 88 have specified the limit of 25 per cent of the salary of the employee for each year as reduced by the employer's contribution to the fund. It was not permissible for the Board after having framed rule specifying the limit to reduce that limit indirectly by purporting to specify conditions subject to which the deduction could be claimed. Condition No. 2 in the notification has the effect of reducing the limit by 20 per cent even without a rule having been made to that effect. Condition No. 3 has the eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nswered in favour of the assessee and against the Revenue. 15. The second question referred to us is with regard to the claim for investment allowance in respect of intercom, amplifiers and air-conditioners installed in the computer room which has been regarded as part of the factory premises of the assessee by the authorities below. The ITO has denied the benefit of the investment allowance for these items on the ground that they are office appliances falling within s. 32A; second proviso cl. (b). That proviso reads thus : "Provided further no deduction shall be allowed under this section in respect of... (b) any office appliance or road transport vehicles; " 16. The expression "office appliance" has not been defined in this section or in the definition section of the Act. While there is no difficulty in ascertaining the meaning of the term "appliance" difficulty arises in treating appliances which are capable of being used in diverse locations, as office appliances, merely on the ground that such appliances are capable of being used in the office, even while, they are equally capable of being used elsewhere. 17. The word "appliance" normally denotes a mechanical, electr ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
