Section 43b

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 June 2013 Dear All,

Is there any amendment regarding allowability of employers contribution in gratuity which is allowable on actual payment basis u/s 43B.

As client is arguing that now gratuity has been deleted from this section.
Is it so.....?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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27 June 2013 He may be talking of about his Section or intentions.
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It is still there in Section 43B and not amended.
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Querist : Anonymous

Querist : Anonymous (Querist)

28 June 2013 Thanx Sir,

Actually he is saying that now in tax audit report we will not include gratuity u/s 43b as separate section 40A(7) is there for gratuity.

And in the calculation of Deferred Tax too we separately show gratuity expenses from the expenses of Section 43B.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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28 June 2013 Then you have to analyse his reply. However it must be borne in mind that the provisions of Section 43B have an overriding effect on all the relevant provisions.
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Also, check whether the amount provided towards approved gratuity funds has been paid on or before the due date.
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Querist : Anonymous

Querist : Anonymous (Querist)

28 June 2013 Ya exactly i have think for,
and half amount has been paid before 30th September, so i argue to disallow the remaining amount u/s 43B.

As the affect he is satisfied with the disallowance of remaining unpaid amount but not under section 43b but in section 40A(7).
Is he right?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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28 June 2013 When the amount will be paid at a later date, it can be claimed U/s 43B on payment basis whereas if it is disallowable U/s 40A(7), ON PAYMENT, NOTHING WILL BE ALLOWED.
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Advise him accordingly.
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