TMI Blog1991 (6) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... x Reference No. 82 of 1989 : "Whether, on the facts and in the circumstances of the case, the assessee is entitled to claim deduction of the contribution of Rs. 90,220 made to the unrecognised Executive Staff Provident Fund ?" These questions of law arise out of the consolidated order dated September 11, 1987 of the Income-tax Appellate Tribunal, Cochin Bench, in I. T. A. Nos. 134 and 135/Coch. of 1984, in respect of the assessment years 1978-79 and 1979-80. The assessee, a public limited company, carrying on the business of manufacture and sale of coir products, claimed deduction of an amount of Rs. 16,359 for the assessment year 1978-79 and an amount of Rs. 90,220 for the assessment year 1979-80 being contributions made by it to the E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under section 40(a)(iv) of the Income-tax Act. With these undisputed facts in the background, we will examine the contentions raised by the Revenue and the assessee. According to the Revenue, when there is a specific provision made in section 36(1)(iv) of the Income-tax Act, 1961, for deducting payments to a fund, for meeting the liability in respect of provident fund, such deduction can be claimed only under section 36(1)(iv). Admittedly, the assessee is not entitled to such deduction in terms of the above provision. It was further contended that the claim made by the assessee is in respect of a liability which is in the nature of a liability falling under section 36(1)(iv) and, therefore, the words within brackets "not being expenditu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n mind the reason for the introduction of the words within brackets not being expenditure of the nature described in sections 30 to 36, we have to remember that those words do not preclude certain species of liabilities but only exclude consideration of liabilities which would fall under any of those sections. " This court held that the mere fact that a claim will not fall under any of the sections 30 to 36 will not automatically make the claim unsustainable under section 37(1) of the Act as well. The above decision was taken in appeal before the Supreme Court by the Revenue and the Supreme Court affirmed the same (vide CIT v. High Land Produce Co. Ltd., [1986] 158 ITR 419). The two decisions relied on by the Revenue, which took a contrar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovident fund already maintained by the assessee to the trust at a subsequent stage, the answer was in the negative. If that be the position, the provisions contained in rule 14(1) have no application to this case. Reliance was made by the Revenue on the provisions contained in rule 14(2) to contend that the assessee is not entitled to claim the deduction during the relevant years 1978-79 and 1979-80. Rule 14(2) reads as follows : "(2) When an employee participating in such fund is paid the accumulated balance due to him therefrom, any portion of such balance as represents his share in the amount so transferred to the trustees (without addition of interest, and exclusive of the employee's contributions and interest thereon) shall, if th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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