Section 36(1)(v) — the law in short
What the courts have decided on section 36(1)(v), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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CIT v Textool Co Ltd
Supreme CourtHelps taxpayer
We paid our gratuity money straight to LIC while the fund's approval was still pending. Will s.36(1)(v) be denied?
No, on these facts. Section 36(1)(v) allows a contribution towards an approved gratuity fund, and the department read that as requiring payment into the fund itself. The Court held that the object of the condition is that the employer should have no control over the money, and where the assessee had no control over the fund LIC created and every rupee ultimately reached the gratuity fund the Commissioner later approved, the deduction stood.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.