Judgement

GROVER, J. : This is an appeal by certificate from a judgment of the Bombay High Court in an Income-tax reference. The respondent Company which is the assessee carries on business of the manufacture and sale of yarn and cloth in Bangalore. In 1914 it started a Provident Fund for the benefit of the monthly rated employees and this fund was called "The Staff Provident Fund". Subsequently another fund was started known as the "Workmen Provident Funds". These funds were not recognised under the provisions of Chapter IXA of the Income-tax Act, 1922 (hereinafter called the Act). The employees and the assessee made contributions to the two funds from time to time. The Employees Provident Funds Act (to be referred to as the Provident Funds Act) came into force on 31st October, 1952. The amounts standing to the credit of the two funds on that date so far as they are referable to the contributions by the Company stood as follows :

(1) Staff Provident Fund : Company s contributions upto 31-10-1952 89,605-9-2

Proportionate interest thereon 19,596-8-7 1,09,202-1-2

(2) Workmen s Provident Fund : Company s contribution upto 31-10-952 1,83,190-13-2

Proportionate interest thereon. 9, 379-2