Circular No. 194

497. Contributions to family pension fund established under Employees' Provident Fund and Family Pension Fund Act -Whether covered under clause (a)(ii) of sub-section (2)

What this is

Circular No. 194 was issued by the Central Board of Direct Taxes on 20 March 1976. Its subject is 497. Contributions to family pension fund established under Employees' Provident Fund and Family Pension Fund Act -Whether covered under clause (a)(ii) of sub-section (2).

What it does

Allows contributions to a family pension fund established by a scheme under the Employees' Provident Fund and Family Pension Fund Act, 1952 to be counted in the aggregate qualifying for deduction under section 80C(1). The Board's view is that clause (a)(ii) of section 80C(2) is wide enough to take in such contributions.

Why it was issued

The question whether such contributions attract relief under section 80C(2)(a)(ii) had been put to the Board.

Who it reaches

Employees contributing to the family pension fund under the 1952 Act
Employers computing salary TDS for such employees

The provisions it speaks to

Left, the provision of the Income-tax Act, 1961 as the instrument itself names it. Right, the section of the Income-tax Act, 2025 that the department’s own concordance maps it to — which is where the same ground is now covered.

Under the 1961 Act	Now
s.80C	s.2, s.123

The instrument, as the Board published it

The words below are the department’s own, reproduced from its published text. Where the department’s copy carried a publisher’s notes after the instrument, those are not reproduced.

497. Contributions to family pension fund established under Employees' Provident Fund and Family Pension Fund Act -Whether covered under clause (a)(ii) of sub-section (2)
1. The question whether contributions to family pension fund established by a scheme under the Employees' Provident Fund and Family Pension Fund Act, 1952, will be entitled to the relief under section 80C(2)(a )(ii) has been considered by the Board.
2. The provision contained in section 80C(2)(a)(ii) is wide enough to include the contributions made towards the family pension fund established by a scheme under the Employees' Provident Fund and Family Pension Fund Act, 1952, for determining the aggregate of sums qualifying for deduction under section 80C(1).
Circular : No. 194 [F. No. 167/37/71-IT (A-I)], dated 20-3-1976.

What to watch

The ruling is on the qualifying amount only; the aggregate is still subject to the limits and conditions section 80C then imposed.
It is confined to a family pension fund established by a scheme under the Employees' Provident Fund and Family Pension Fund Act, 1952.
Section 80C has since been recast in terms this text does not carry, and the deduction it now gives is not the one this circular speaks to.

Where you meet it

In the salary computation and the section 80C claim of an employee covered by the family pension scheme.

On the same provision

Other instruments in this library that name the same provision of the 1961 Act. They are not necessarily still operative, and a later one may have replaced an earlier one without saying so.

Notification No. 134/2021 [F. No. 178/4/2021-ITA-I] / SO 5056(E) — 2 the Gazette of INDIA : Extraordinary [Part Ii—sec. 3(ii)] 6 December 2021
Notification No. 45/2020 [F. No.370142/26/2019-TPL] / SO 2232(E) — Ministry of Finance 7 July 2020
Notification No.91/2015 [F.No.178/21/2014-ITA.I] / SO 3313(E) — jftLVªh laö Mhö ,yö&33004@99 REGD. NO. D. L.-33004/99 8 December 2015
Circular No. 19/2015 — Circular No.- 19 /2015 27 November 2015
Circular 1/2015 — Explanatory notes to the provisions of the finance no.2 act 2014 21 January 2015
Notification No. 9/2015 [F.No.178/3/2015-ITA-I]/SO 210(E) — Section 80C of the Income-tax Act, 1961 - Deductions - in Respect of Insurance Premium, ETC. - Notified Plan under secti 21 January 2015

← Circular No. 193 · Circular No. 192 →

A circular binds the department, not you and not a court. The Board issues a circular to its own officers. An assessee may hold the department to a circular that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves.

Source: the Income Tax Department’s own published text — its page for this instrument.