COMMISSIONER OF INCOME TAX Vs. GARWARE SYNTHETIC BRISTLES

JUDGEMENT

(1.) This appeal is preferred by the Revenue against an order of the High court of Bombay rejecting an application under section 256(2) of the Income-tax Act, 1961. By the said application, the Revenue asked the court to direct the tribunal to state the following two questions for the opinion of the High court :

(2.) The assessment year concerned is 1972-75. Ss. (7) of section 40A is not applicable to the said assessment year. Ss. (7 was introduced by the Finance Act, 1975 , with retrospective effect from 1.04.1975. In other words, Ss. (7) applies on and from the assessment year 1975-74.

(3.) The assessee claimed a deduction of Rs. 56,851.00 on account of the provision made by it for payment of gratuity to its employees for the accounting year relevant to the assessment year 1972-75. The deduction was allowed under section 57 of the Income-tax Act. This was objected to by the Revenue and the aforesaid questions were sought to be raised.