1998 (8) TMI 32

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... f the Revenue is as to whether the Tribunal was right in holding that the assessee's claim for deduction of a total sum of Rs.61,228 on account of gratuity to the employees for the assessment year 1974-75 was acceptable. We have been taken through the order of the Tribunal. The Tribunal has proceeded on a misconception that the actuarial valuation on the basis of which liability for paying gratu .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... liability based on the actuarial valuation. The finding of the Tribunal is flawed. It is not in dispute that the assessee maintained its accounts on the mercantile system. The liability for gratuity is calculated on the basis of an actuarial valuation, which takes into account the total number of employees entitled to receive gratuity, and the incremental liability to each of them for gratuity w .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... n covered by the provisions during the earlier years are available. There was also no material to show that the actuarial valuation as at the end of the previous year relevant to the assessment year had omitted to take into account the liability which had accrued during the year for gratuity towards employees who have retired during the course of the year. In these circumstances, the Tribunal wa .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X