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Balanoor Tea and Rubber Co. Ltd. Vs. State of Karnataka and anr. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtKarnataka High Court
Decided On
Case NumberCivil Revision Petition No. 1721 of 1978
Judge
Reported in(1984)43CTR(Kar)94; [1984]148ITR736(KAR); [1984]148ITR736(Karn)
ActsIncome Tax Act, 1961 - Sections 37(1); Agricultural Income Tax Act, 1957 - Sections 5
AppellantBalanoor Tea and Rubber Co. Ltd.
RespondentState of Karnataka and anr.
Appellant AdvocateS.P. Bhat, Adv.
Respondent AdvocateS. Rajendra Babu, Adv.
Excerpt:
- sections 13(1)(ia)(ib): [k.l. manjunath & b.v. nagarathna, jj] divorce - decree of divorce sought by the appellant/husband -dismissal of m.c. case appealed against ground that plea of mental and physical torture and desertion re-appreciation of evidence - held, the very fact that the marriage has not been consummated for over a period six years would disclose the conduct of the appellant.. evidence of wife further discloses that the appellant/husband is having illicit relationship with another lady which portion of the evidence of wife has not been touched in the cross-examination. the appellant has not even stated various instances which according to him caused physical cruelty or mental cruelty. when there is lack of evidence of the appellant in his pleadings as well as in..........from a tea estate and also from two coffee estates. in respect of the assessment year 1974-75, the company claimed deduction in respect of the provision made for gratuity payable to its employees. the sum so claimed was rs. 83,257.15 on the estimated liability. the assessing officer allowed the claim under s. 5(k) of the act following the principle stated by the supreme court in metal box company's case : (1969)illj785sc . but, the commissioner, in exercise of his revisional jurisdiction conferred under s. 35 of the act, revised that portion of the assessment by holding that s. 5(k) of the act is not at all relevant for the purpose of allowing gratuity liability and that r. 5(d) of the karnataka agrl. i.t. rules, framed under s. 63 of the act, is the only rule relevant governing the.....
Judgment:

Jagannatha Shetty, J.

1. This revision under s. 55 of the Karnataka Agricultural Income-tax Act, Act, 1957 (hereinafter referred to as 'the Act'), is directed against the order of the Commr. of Agrl. I.T. made under s. 35 of the Act.

2. The petitioner-company is deriving agricultural income from a tea estate and also from two coffee estates. In respect of the assessment year 1974-75, the company claimed deduction in respect of the provision made for gratuity payable to its employees. The sum so claimed was Rs. 83,257.15 on the estimated liability. The assessing officer allowed the claim under s. 5(k) of the Act following the principle stated by the Supreme Court in Metal Box Company's case : (1969)ILLJ785SC . But, the Commissioner, in exercise of his revisional jurisdiction conferred under s. 35 of the Act, revised that portion of the assessment by holding that s. 5(k) of the Act is not at all relevant for the purpose of allowing gratuity liability and that r. 5(d) of the Karnataka Agrl. I.T. Rules, framed under s. 63 of the Act, is the only rule relevant governing the question. He also held that under r. 5(d), the gratuity claimed cannot be allowed since it was only a provision made and not an actual payment.

3. We do not think that the view taken by the Commissioner could be justified. Section 5(k) of the Act is analogous to s. 37(1) of the I.T. Act, 1961, and r. 5(d) is similar to s. 36(1)(v) of the said Act. The scope of these provisions was considered by this court in Addl. CIT v. Karnataka State Warehousing Corporation : [1980]125ITR136(KAR) and the accrued liability towards the payment of provident fund was allowed as a permissible deduction. Although the present case is concerned with the provision made towards gratuity, it makes no difference on principle and the ratio of the said decision, in our opinion, is equally applicable, since there is no dispute about the compliance of the requirements of s. 5(k).

4. In the result, the revision petition is allowed, the order of the Commissioner is set aside and the assessment order is restored.

5. In the circumstances, we make no order as to costs.


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