COMMISSIONER OF WEALTH TAX Vs. K GOPINATHAN NAIR

JUDGEMENT

(1.) This is a reference under S.27(1) of the Wealth Tax Act, 1957 for short, the Act, and the question referred is in these terms:

(2.) The year of assessment with which we are concerned is 1971-72. The assessee had claimed a sum of Rs. 8,60,690 as liability towards gratuity payable to its workmen as a deduction under S.2(m) of the Act. S.2(m) runs thus:

(3.) This reference has come to us at the instance of the Commissioner of Wealth Tax. The section in the Kerala Industrial Employees' Payment of Gratuity Act, 1970, for short, the Gratuity Act, which imposes the liability to pay gratuity is S.4 and we shall extract that section: