D. M. CHANDRASHEKHAR, J. - (1.) The Income Tax Appellate Tribunal, Allahabad Bench (shortly called the Tribunal), has referred to this to this court the following four question of law, under sub -S. (1) of S. 256 of the Income Tax Act, 1961 (shortly called the Act) : (1) Whether on the facts and in the circumstances of the case the Appellate Assistant Commissioner did not exceed his jurisdiction in enhancing the assessment ? (2) Whether a correct interpretation of the Notification of the U.P. Government dated 27 -1 -1961, the resolution dated 10 -9 -1963, passed by the Board of Directors of the company and the Trust Deed dated 30 -9 -1963, the liability in respect of gratuity against which the sum of Rs. 2,00,000/ - was paid and debited to the gratuity fund in the relevant previous year accrued in the relevant previous year ? (3) Whether on the facts and in the circumstances of the case the expenditure allowable under S. 28(1) or under S. 37(1) of the Income Tax Act, 1961 is Rs. 50,000, or Rs. 2,03,207 ? (4) Whether on the facts and in the circumstances of the case the Tribunal was justified in allowing a deduction of Rs. 50,000/ - when the gratuity fund was not approved by the Commissioner of Income Tax required under S. 36(1)(v) of the Income Tax Act, 1961, for 1964 -65 assessment year ?
(2.) The first three questions have been referred to this court by the Tribunal at the instance of the assessee and the fourth question at the instance of the Revenue.
(3.) Briefly stated, the relevant facts are these : The assessee is a company carrying on manufacture of sugar since about the year 1935. It has been maintaining its accounts following the mercantile system. The assessment year under reference is 1964 -65 for which the accounting year is from 1 -10 -1962 to 31 -9 -1963.;