Sabyasachi Mukherjee, J. - (1.) The statement of the case relates to the assessment year 1969 -70 and the question which has been referred to us is as follows : Whether, on the facts and in the circumstances of the case, the Tribunal was right in allowing the claim of the assessee for Rs. 31,698 under Sec. 37(1) of the Income -tax Act, 1961, relating to the assessment year 1969 -70? The assessee is a limited company in which it was stated that the Government of West Bengal had substantial shares. During the accounting year under reference, the assessee claimed expenses in respect of contribution to gratuity fund for Rs. 31,698. The ITO rejected this claim on the ground that the claim was inadmissible in view of the provisions of Sec. 36(1) (v) of the Income -tax Act, 1961 ('the Act'). The ITO held that the claim could not be made under Sec. 37(1) of the Act.
(2.) The assessee appealed before the AAC. The AAC confirmed the view taken by the ITO. He, however, allowed the claim of the assessee to the extent of Rs. 4,047 because this claim was with reference to the year 1968. The assessee earned the matter further.
(3.) Before the Tribunal it was argued on behalf of the assessee that the AAC wrongly appreciated the decision of the Supreme Court in the case of Metal Box Co. of India v/s. Their Workmen : [1969] 73 ITR 53 and certain other observations were referred. The Tribunal considered the various terms of the trust deed and held that the expenditure could be allowed under Sec. 37(1) Upon this, the question as indicated above has been referred to us.;