Specific Provision Section 40A(7)(B) Will Take Precedence Over Comparatively General Provision Section 43B

Case Name: M/s Sanmar Speciality Chemicals Limited v. The Assistant Commissioner of Income

The Madras High Court ruled that Section 40A(7)(b) of the Income Tax Act, which allows deductions for contributions to approved gratuity funds, overrides Section 43B, which mandates deductions only upon actual payment.

The case involved M/s Sanmar Speciality Chemicals Ltd, which claimed a deduction for a gratuity fund contribution.

The Assessing Officer denied it under Section 43B. However, the court held that specific provisions take precedence over general ones, citing Sarwan Singh v. Kasturi Lal.

This decision clarifies that contributions to approved gratuity funds are deductible despite the general payment-based restriction in Section 43B.

HC Judgment / 6 months ago

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