TMI Blog2021 (9) TMI 966X X X X Extracts X X X X X X X X Extracts X X X X ..... ith all the other conditions for claim of deduction except approval which is to be granted by the Department. We see no reason that the assessee cannot claim deduction for the in action of the PCIT. Hence, we reverse the orders of the lower authorities and respectfully following the legal proposition laid down by High Courts in the above case laws, we allow the claim of the assessee. - ITA No. 4017/Mum/2019 (Assessment Year 2015-16) - - - Dated:- 13-8-2021 - SRI MAHAVIR SINGH, VP AND SRI M. BALAGANESH, AM Appellant by: Shri Dhanesh Bafna, AR Respondent by: Shri Brajendra Kumar, DR ORDER PER MAHAVIR SINGH, VP: This appeal of assessee is arising out of the order of the Commissioner of Income Tax (Appeals)]-22, Mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with DCIT, Circle 1(2), Vadodara and has duly complied with all the formalities as required to secure the approval for the superannuation fund. It was admitted by the assessee that the superannuation fund still not approved despite having duly followed up from time to time. The Assessing Officer disallowed the claim of employees contribution towards superannuation fund amounting to ₹55,35,549/- in the absence of approval. Aggrieved, assessee preferred the appeal before Commissioner of Income Tax (Appeals). The CIT(A) also confirmed the action of the Assessing Officer by observing in Para 3.3 as under:- 3.3 Decision The Appellant contributed ₹55,35,549/- towards superannuation fund set up by the Appellant, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f amounts paid into unapproved funds under the cover of section 37 may defeat the legislative intent and frustrate the very purpose underlying the specific provisions made there under. The assessee made contributions towards superannuation funds for the benefit of its employees. The assessee made an application to the Commissioner for approval for the superannuation scheme; however, the same was yet to granted approval by the CIT. The contribution to an unapproved fund did not qualify for deduction under section 36(i)(iv). Further the deduction which the assessee claimed was admittedly of the nature described in section Therefore section 37 would not come to the aid of the assessee. From above it becomes clear that if particular fund is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fund. 5. Hence, he stated that the assessee has provided all information/ clarification to the PCIT towards its application for recognition of superannuation fund and has also cooperated with the PCIT as and when called. In this regard, the learned Counsel for the assessee relied on the case laws, which is identical to the facts of the present case of Hon ble Rajasthan High Court in the case of CIT vs. Jaipur Thar Gramin Bank [2016] 388 ITR 228 ( Rajasthan) dated 12.07.2016 wherein it is held as under:- The assessee cannot suffer for the inaction of the Revenue authorities and the AO ought not to have disallowed the claim merely because the Commissioner has not granted approval of the Gratuity Scheme. Once the assessee fulfills t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approval of the fund having been made before 1-1-1976. The assessee cannot create an approved gratuity fund unless the approval is granted by the Commissioner. Once an application has been made within the time prescribed by the Act, there is nothing more that could be done by the assessee under the law. The Commissioner by withholding the grant of approval on the one hand could not contend on the other, that the assessee did not satisfy the conditions laid down under section 40A(7)(b)(ii). The Commissioner may refuse to accord approval if he finds that the assessee has not satisfied all the conditions required for such approval to the gratuity fund. It was not the case here that the gratuity fund created by the assessee was not liable to b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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