BY BENCH Assessment years involved are 1 99 -91 to 1 99 7-98. In this bunch of sixteen appeals eight appeals filed by assessee and eight appeals filed by Department, assessee is one and all eight assessment years relating t o all appeals are same. Since cross appeals have been filed both by assessee and by Department and identical issues are involved, it has been deemed proper to pass one common consolidated order for sake of convenience. 2 . learned Authorised Representatives of assessee have filed some paper books in order to facilitate Bench to be acquainted with facts and legal points involved in all appeals which are narrated as under : 3. first paper book containing 33 pages consist of following : (a) Page 1 relates to details of expenses disallowed by AO and confirmed by learned CIT(A) against which assessee is in appeal before Tribunal. From same it transpires that for asst. yrs. 1 99 -91 and 1 99 1-92 assessee is in appeal against disallowance of interest on refinance paid to IDBI, commitment charges paid to IDBI, interest on loan in lieu of share capital paid to IDBI and right from asst. yrs. 1 99 -91 to 1 99 7-98 assessee is aggrieved against both orders of AO and of learned CIT(A) for disallowance made and confirmed relating to employer s contribution to OSFC Employees Provident Fund. Further, assessee is aggrieved for asst. yr. 1 99 -91 against disallowance made for employees own contribution to Employees Provident Fund. Again assessee is in appeal for asst. yrs. 1 99 1-92 to 1 99 7-98 against disallowance and confirmation of brokerage and underwriting commission paid on issue of bond, employees own contribution to Employees Provident Fund and interest paid on OSFC Employees Provident Fund. (b) Page 2 contains assessment year wise details, statement relating to interest on refinance paid to IDBI, interest on LISC paid to IDBI, commission charges paid to IDBI, brokerage and underwriting commission on issue of bond, employees own contribution to EPF, interest on employees provident fund, employer s contribution to EPF. (c) Pages 3 to 16 contain explanatory note on expenses disallowed by AO relating to asst. yr. 1 99 6-97, pp. 17 to 26 contain explanatory note on expenditure disallowed by AO relating to asst. yrs. 1 99 -91 to 1 99 7-98. Pages 27 and 28 contain explanatory note on expenses disallowed by AO relating to asst. yrs. 1 99 -91 and 1 99 1-92. Pages 29 and 30 contain explanation on brokerage and underwriting commission on issue of bond with citation of case law in support of contention taken by assessee. Page 31 contains booklet of OSFC Employees Provident Fund Regulation, 1959 containing 20 pages. Page 32 contains assessment order for 1963-64 passed by then AO. Page 33 contains demand notice in Form No. 9 under s. 156 for asst. yr. 1963-64. learned counsel has also filed booklet for background material without containing education programme on accounting standard notified under t h e IT Act and practical guide on p. 34. He has also enclosed relevant portion to show meaning of paid and pay from relevant portion of Mitra s Legal Commercial Dictionary on pp. 35 to 37 to show meaning of paid and adjust . He had also enclosed one decision of Hon ble Bombay High Court in case ofCIT vs. Tata Hydro Electric Supply Co. Ltd. (1 99 6) 132 CTR (Bom) 137 : (1 99 6) 219 ITR 178 (Bom). He has also filed in second booklet meant for asst. yr. 1 99 -91, details of item-wise comparative chart of expenses, explanatory note of expenditure disallowed by AO. Similarly, he has filed in same line for asst. yrs. 1 99 2-93 to 1 99 7-98. 4. learned counsel briefly analysing facts of case respectfully submitted that assessee OSFC has established Employees Provident Fund Scheme in this case duly approved by RBI and Government. While contributing to said fund assessee has maintained separate account and has been regularly debiting to same by maintenance of separate management fund where two directors are responsible to hold and manage fund. AO did not allow amount contributed by assessee on ground that there is no actual cash payment by employer. This is main grievance of assessee to come in second appeal before this Bench. In appeals filed by Department, Department has agitated against acceptance of employees contribution to EPF by learned CIT(A). AO has treated this non-compliance of s. 43B. According to learned CIT(A), CAG does not approve retention of money by assessee of EPF fund without keeping it in any scheduled bank. Other points are ancillary points to be considered while going into details year-wise. Now we shall proceed on issues involved in all these appeals chronologically. Assessment year : 1 99 -91 5 . In this appeal assessee has agitated five grounds but issues involved are four. Ground Nos. 1 and 2 relate to disallowance of sum of Rs. 12,14,854 under s. 43B of IT Act, 1961 being share of employer s contribution to EPF, which was disallowed by learned CIT(A). On perusal of relevant portion of order of learned CIT(A) it transpires that learned CIT(A) has allowed employee s matching contribution of EPF and disallowed employer s contribution to EPF. After perusing ground Nos. 1 to 3 it is pertinent to note here that there is omission somewhere either by assessee or by learned CIT(A) which is pointed out at this level that dispute only relates to employer s contribution to Provident Fund. 5.1 next issue relates to disallowance of sum of Rs. 4,98,54,284 being interest paid to IDBI on borrowed money debited in this year on ascertainment and reconciliation which was duly approved by CAG according to appellant. third issue as per ground No. 5 pertains to disallowance of sum of Rs. 79,19,654 being commitment charges paid to IDBI on borrowed money debited this year on ascertainment and reconciliation duly approved by CAG. Ground Nos. 6, 7 and 8 are supporting grounds to main issues. 5.2 With regard to main issue i.e. disallowance of provident fund as per stand taken by learned counsel on behalf of appellant as is evident from arguments heard, written notes and explanation submitted along with case laws cited, it transpires that OSFC is statutory corporation established under State Financial Corporation Act, 1951 [an Act passed in Parliament of India (LH III of 1951)] in terms of s. 16 of Employees Provident Fund and Miscellaneous Provisions Act, 1952. SFCs are especially exempted from purview of EPF Act under s. 48(2) of SFC Act, Board of Directors of Corporation are authorized to make regulations for establishment and maintenance of provident fund or other benefit funds for employees of financial corporations. Board of Directors of OSFC in exercise of powers conferred by s. 48 of SFC Act in consultation with RBI and with previous sanction of Government of Orissa has made regulation named as "OSFC Employees Provident Fund Regulations, 1959" to establish and maintain provident fund for benefit of employees of OSFC. Accordingly, OSFC Employees Provident Fund has been created and in terms of art. V of said regulation, fund is held by corporation and is administered by Board of Administrators elected/nominated by Board of Directors of corporation called as administrators of fund. That apart they have got one resolution of their own known as Employees Provident Fund Regulations, 1959. As per clauses and conditions adumbrated in this regulation at particular ratio subscription from employees are duly collected and credited in separate account duly maintained by appellant-corporation every month while disbursing salary by deducting from same. It is in consonance with regulation No. 7 according to learned counsel. Again as per regulation No. 9 assessee-corporation contributes its own contribution at fixed rate as per decision of Board of Administrators every month. As per regulation No. 11, according to decision taken by Board of Administrators at par with provisions of EPF Act interest at fixed rate is being duly credited in respective accounts of each employee under EPF Act every year, i.e., at end of year 31st March. Therefore, contentions of appellant- corporation is that one separate account is being duly maintained for purpose of contribution of provident fund both by employees and by employer, interest is being paid in consonance with EPF Act and fund is being managed and controlled by Board of Administrators duly elected/nominated by corporation from amongst directors and employees, respectively. 5.3 During course of argument learned counsel further argued and replied in response to queries made by Bench that employees do not have any objection till date and are assured and are safe and secured so far as maintenance of provident fund by Board of Administrators is concerned. At time of their requirement and necessity fund is being duly disbursed to them or to their families and there is no grumbling in that regard from side of employees. Right from asst. yr. 1963-64 till asst. yr. 1989-90 IT Department has already accepted themodus operandiwith regard to maintenance of provident fund account by assessee-corporation. 5.4 Thus, apprising factual aspect on issue involved regarding EPF and disallowance so made by learned CIT(A) learned counsel further proceeded with legal aspects involved on this issue and argued before Bench on relevant sections, provisions and case laws involved on this issue. 5.5 Sec. 2(24)(x) of IT Act, 1961 provides that any sum received by assessee from employees as contribution to any provident fund shall be included in its income. However, same shall be allowed as deduction under s. 36(1)(va) of IT Act, 1961 if same is credited by assessee to employees account in relevant fund on or before due date. 5.6 As per Explanation following s. 36(1)(va) for purpose of this clause due date means date by which assessee is required as employer to credit employee s contribution to employee s account in relevant fund under any Act, Rule, Order or Notification issued thereunder or under any standing order, award, contracts of service or otherwise. 5.7 Supporting with relevant sections learned counsel vehemently objected to observation made by AO in this regard as to not having recognised provident fund or not making any payment of employees contribution to provident fund authority in State of Orissa or to any administrators otherwise under OSFC Provident Fund Regulations to administer fund. On perusal of assessment order and order of learned CIT(A) in this connection it was found that both orders are quite cryptic and does not state facts in detail as have been borne out from record. 5.8 According to learned counsel it is not required/necessary to pay amount to recognised provident fund authority in State of Orissa as OSFC like other SFCs are excluded from purview of General Provident Fund and Miscellaneous Provisions Act, 1952 (under s. 16 of said Act) and under s. 48(2) of SFCs Act, 1951. assessee-corporation with prior approval of RBI and State Government has formulated its regulations for establishment and maintenance of provident fund of its employees. 5.9 Further it has been stand of appellant that in cash system of accounting there should be actual or constructive payment. According to provisions of s. 43(2) of IT Act, 1961 assessee paid means actually paid or incurred according to method of accounting upon payees of which profits and gains are computed under head "Profits and gains of business or profession". Dictionary meaning of word realised is to mean "convert into actuality" or "convert into money". 5.10 In order to show that maintenance of account is proper and as per practical guide of accounting standard learned counsel referred to p. 31 of July, 1 99 7 issue of publication of ICAI in this regard. learned Departmental Representative on other hand, while defending Revenue invited our attention to p. 31 of paper book Chapter II part 5 that filed by assessee-corporation on Employees Provident Fund Regulations, 1959. Thus, drawing to relevant portion learned Departmental Representative emphatically argued that since provident fund account has not been kept in scheduled bank objections raised by Revenue having binding force on assessee-corporation, disallowance/addition on this ground should be sustained by Tribunal. 5.11 On perusal of relevant portion of Employees Provident Fund Regulation, 1959 Chapter VI Part 5 it is stated as : "5.Admn. fund shall be held by corporation or in any scheduled bank approved by board of administrators and shall be administered by board of administrators consisting of managing director and two other directors elected by board of directors of corporation and one subscriber nominated by board of directors of corporation. These persons shall be called administrators of fund." Thus, vide this clause appellant-corporation is eligible to hold fund itself or can deposit it in any scheduled bank. 5.12 On hearing contested rival submissions, going through factual as well as legal aspects involved in issue, perusing detailed paper book filed and case record, it has been observed that general impression carried out by Revenue with regard to maintenance of provident fund account in scheduled bank like other assessees in general is not at all applicable to assessee-corporation in impugned case. It has been found on analytical basis as has been rightly pointed out during course of hearing by learned counsel appearing before this Bench that there is no grumbling from side of employees so far as their sense of security of account is concerned and requirement of withdrawal according to necessity is involved. Even as per contentions taken by assessee-corporation, assessee-corporation is excluded from clutches of provident fund authorities under State of Orissa under Employees Provident Fund Act and Rules as per prior approval and sanction of RBI and State Government of Orissa combined together. So certainly it is special case of its own nature where general treatment of Revenue authorities cannot be applicable to this assessee-corporation as they have separate regulation of their own for administration of EPF is concerned. Even relating to interest paid on outstanding provident fund dues there is no relevance with either s. 43B or s. 2(24)(x) or s. 36(1)(va) of IT Act, 1961 as this is also made by assessee-corporation on investments made from fund/fund held by corporation and utilised for purpose of financing to industrial unit. On this backdrop of case both factually and legally assessee-corporation appears to have sound case whereas objections raised by Revenue are general in nature without any specific finding as to any irregularity. It will not be out of place to mention here that IT Department has not gathered any information of violation of EPF Act and Rules from concerned authority administering same in State of Orissa nor there is any complaint from any employee s side. Thus, Revenue s treatment to fund maintained by assessee-corporation in general terms cannot be sustainable in view of specific exception clause applicable to assessee-corporation in light of analysis and observation made above. 5 . 1 3 Besides this, appellant-corporation has taken resort to decision of Hon ble apex Court in case ofStandard Triumph Motor Company Ltd. vs. CIT (1 99 3) 110 CTR (SC) 270 : (1 99 3) 201 ITR 391 (SC)and guidelines issued by Institute of Chartered Accountants of India. F o r better appreciation of legal position case cited as analysed hereunder : "In this case it has been held by apex Court that credit entry of royalty to account of appellant in books of Indian company amounted to receipt of royalty by appellant and it was accordingly taxable. It was immaterial when appellant actually received it in UK and method of accounting adopted by appellant was irrelevant and, therefore, order of remand made by Tribunal was unnecessary." This case law relates to point regarding receipt of royalty. 5 . 1 4 Thus, despite strong opposition from side of learned Departmental Representative, we do not have any hesitation to allow this ground in favour of assessee-corporation and against Revenue. 5.15 This covers ground Nos. 1, 2 and 3 filed by assessee in its appeal for asst. yr. 1 99 -91. 6. Ground No. 4 relates to disallowance of sum of Rs. 4,98,54,284 being interest component paid to IDBI on borrowed money debited in this year on ascertainment and reconciliation which has duly approved by CAG. In this regard learned counsel respectfully submitted that refinance by IDBI is major source of fund of corporation. After sanction and disbursement of loan to loanees assessee-corporation lodges claims with IDBI for release of refinance under s. 7(4) of SFCs Act, 1951, which becomes long-term borrowing of corporation. IDBI being refinancing agency had deducted amount of Rs. 4,98,54,284 in year 1988-89 without sending details of nature of deduction to OSFC. details of such deductions were made available to assessee in year 1989-90 after various persuasions in this regard. In year 1988-89 such amount was shown as advance deposit to IDBI. In year 1989-90 having received details same was charged to proper head namely interest on loans from IDBI. This aspect was duly disclosed vide note No. 16 in Sch. R of published account duly audited and approved by CAG of India. Therefore, claim of assessee-corporation is legal on this point. 6 . 1 Despite strong opposition from learned Departmental Representative on this point, we shall have to place reliance on stand taken by assessee-corporation on this point as their contention is based on correspondence held in between them and IDBI and is stated to have been duly audited and approved by CAG of India. Accordingly, this point is decided in favour of assessee and against Revenue. 7 . Next ground i.e. ground No. 5 relates to disallowance of sum of Rs. 79,19,654 being commitment charges paid to IDBI on borrowed money. On this ground also stand of assessee-corporation is that it has been duly debited on ascertainment and reconciliation which was duly approved by CAG. 7.1 learned Departmental Representative though strongly contested this point, we find from case record that no queries have been raised on this point nor any material has been gathered to disprove stand of assessee. Therefore, stand taken by assessee-corporation has to be accepted as it is open declaration made before this Bench by assessee-corporation regarding ascertainment of details from IDBI and due reconciliation and approval of CAG is there. 8. Ground No. 6 relates to disallowance of Rs. 1,65,35,187 being interest on loan in lieu of share capital according to assessee-corporation. 8.1 In this connection assessee-corporation has contended that during years 1983 to 1987, pending amendment to SFCs Act and enhancement to authorised capital of corporation, both State Government and IDBI have contributed to share capital of corporation in shape of loan in lieu of share capital on matching proportion. Such loans are meant to be converted to ordinary share capital as per schedule of conversion mutually agreed between State Government and IDBI. These loans given by IDBI represents quasi-equity of corporation for interim period till extension of authorised capital and conversion to equity. 8 . 2 On such loan in lieu of share capital, IDBI had deducted Rs. 1,65,35,187 towards interest in year 1988-89 at front from refinance disbursement and such fact was not made available to corporation. As such i t was shown as advance repayment to IDBI. This fact was ascertained by assessee-corporation in following year, i.e., during year 1989-90 and hence, it was charged to proper head, i.e., interest payment during 1989-90 relevant to asst. yr. 1 99 -91. 8.3 As it appears due to lack of clarity on correspondence in between IDBI and OSFC amount was treated as advance earlier as stated above and later on after ascertainment of real facts from IDBI which was treated as interest payment and charged to proper account. Therefore, charging of interest to IDBI account has to be accepted and allowed. 9 . Thus, on overall study of case record and argument and counter argument placed before this Bench, it appears that assessee- corporation has good case both factually as well as legally as management and affairs of corporation has been based on different footing other than ordinary assessees and disallowances made by Revenue authorities have been made on routine manner without going into depth of matter that assessee-corporation is meant for specific purpose and it is not profit making organisation like other general assessees. Therefore, considering from all possible angles after due study of case, we do not have any hesitation in allowing appeal of assessee against Revenue. Accordingly, assessee s appeal is allowed for asst. yr. 1 99 -91. 10. Now after deliberating issues at length for asst. yr. 1 99 -91, it has been deemed proper to make chart of both issues involved in assessee s appeals and Departmental appeals separately in order to facilitate all quarters to be acquainted with issues and deliberations quickly and in smooth manner as it has been found that issues are almost identical in both assessee s appeal as well as Departmental appeals. Assessee s Appeals Asst. Ground ITA No. Remarks yr. No. Discussed in 1 99 All 78/Ctk/2003 detail in this order -91 grounds para 5 to 9.1 EPF and allowable 1 99 79 to 1 & 2 expenses 1-92 to 1 85/Ctk/2003 (common) discussed in para 99 7-98 5 to 5.14 vide order of 1 99 -91. Interest paid to IDBI-discussed 1 99 79/Ctk/2003 3 in para 6 to 6.1 1-92 vide order of 1 99 -91 Commitment charges paid to 1 99 79/Ctk/2003 4 IDBI-discussed in 1-92 para 7 to 7.1 of order of 1 99 -91. Repetitive and general in 1 99 79/Ctk/2003 5&6 nature. No 1-92 discussion is required. General in 1 99 80 to nature. No 2-93 to 1 3 85/Ctk/2003 discussion is 99 7-98 required. 11. In order to appreciate further case laws cited on different issues by learned counsel appearing on behalf of appellant from enclosures filed for each years separately it has been deemed proper to make analysis of same in order to appreciate legal contention raised on issues although factual aspect has almost been covered in order portion of asst. yr. 1 99 -91. 12. Brokerage and underwriting commission relating to asst. yr. 1 99 1-92 on amount of Rs. 11,10,000 allowed by learned CIT(A) and agitated in Departmental appeal although no separate ground has been agitated by appellant-corporation before Bench to consider ground. As per last ground taken by appellant, reserving right to urge other grounds at time of hearing, same is being considered at instance of assessee. 12.1 contention of appellant is that corporation transacts its annual business as per BPRF (Business Plan & Resource Forecast) approved for particular year by IDBI/SIDBI and State Government. In terms of provisions of s. 7(1) of SFCs Act, 1951, corporation issued and sold bonds for purpose of working business capital for year being allotted by IDBI/SIDBI as per BPRF with approval of RBI. Commission and brokerage for subscription and underwriting of such bonds (as per rate instructed by RBI with each quota of bond allotment) are paid for raising business/working capital as per BPRF for year through issue and sale of bonds is business expenditure for that particular year. Further, money was borrowed by issue of bonds and this act of borrowing money was incidental to carrying on of business. This loan obtained was not asset or advantage of enduring nature. learned counsel has cited certain case laws in this regard in support of his contention those are Tribunal decision of Patna Bench in ITA No. 7567 of 1964-65 (asst. yr. 1962-63) in case ofBihar State Financial Corporation vs. ITO, Ward-A, Patna on basis of decision of Supreme Court of India inIndia Cement Ltd. vs. CIT (1966) 60 ITR 52 (SC)passed in f v o u r of assessee, Bihar State Financial Corporation, wherein brokerage and incidental expenses on issue of bonds as business expenses has been allowed. "In this case reported in(1966) 60 ITR 52 (SC)the appellant obtained loan of Rs. 40 lakhs from Industrial Finance Corporation secured by charge on its fixed assets. In connection therewith it spent sum of Rs. 84,633 towards stamp-duty, registration fees, lawyer s fees, etc. and claimed this amount as business expenditure. Held, that amount spent was not in nature of capital expenditure and was laid out or expended wholly and exclusively for purpose of assessee s business and was, therefore, allowable as deduction under s. 10(2)(xv) of Indian IT Act, 1922. act of borrowing money was incidental to carrying on of business, loan obtained was not asset or advantage of enduring nature, expenditure was made for securing use of money for certain period, and it was irrelevant to consider object with which loan was obtained. Where there is no express prohibition, outgoing, by means of which assessee procures use of thing by such he makes profit, is deductible from receipts of business to ascertain taxable income. Obtaining capital by issue of share is different from obtaining loan by debentures. loan obtained cannot be treated as asset or advantage for enduring benefit of business of assessee." CIT vs. East India Hotels Ltd. (2001) 171 CTR (Cal) 614 in this case it has been held that s. 35D has been introduced to give benefit to assessee in cases of capital expenses. capital expenses cannot be allowed as deduction in computing income but under s. 35D capital expenses can be allowed as deduction in 10 years span, i.e., 1/10th in each year. But how deduction which is allowable otherwise as revenue expenses, can be denied after insertion of s. 35D. counsel failed to explain. Board has also clarified this issue in Circular No. 56, dt. 19th March, 1971. Board clarified that provision of amortisation is not intended to supersede any other provision of income-tax law under which such expenditure is admissible as deduction or deduction allowable by virtue of decision of Supreme Court in case ofIndia Cements Ltd. vs. CIT(supra). Admittedly, here loan has to be repaid within 11 years from date of allotment of debentures. If 20 per cent of that loan is payable by end of 3 years from date of issue of debentures by way of issue of shares to make debentures more lucrative/attractive, that does not change character of repayment of loan within 11 years. Therefore, in view of this admitted fact, there is no reason to interfere with order of Tribunal and it is to be held that expenditure on issue of debentures is deductible as revenue expenditure notwithstanding introduction of s. 35D. 12.2 As is evident from relevant portion of assessment order, AO disallowed these expenses incurred by assessee-corporation as revenue expenses on following grounds : (i) expenditure incurred relates to raising of capital. (ii) CBDT Circular No. 32/6/02 ITA-1 dt. 16th Jan., 1963 is clear on point that expenditure incurred in connection with raising of such capital can only be treated as capital expenditure. (iii) maximum deduction can only be permitted in accordance with provisions of s. 35D of IT Act, 1961. (iv) That expenditure cannot be allowed lawfully as per decision of Hon ble Calcutta High Court in case ofWoodcrafts Ltd. vs. CIT (1 99 2) 106 CTR (Cal) 2 99 : (1 99 3) 204 ITR 545 (Cal). learned CIT(A) in relevant portion of his order has deleted same justifying with case laws cited by assessee and Department is aggrieved on issue of deletion. Accordingly, we are to deliberate on same as follows : As per decision of Calcutta High Court in case ofWoodcraft Ltd. vs. CIT(supra) it has been held that in this decision decision ofUnion Carbide India Ltd. vs. CIT (1986) 56 CTR (Cal) 231 : (1987) 165 ITR 678 (Cal)has been followed which is held as under : "That, on issue of bonus shares, portion of reserves of company have to be transferred and shown as subscribed capital. This has nothing to do with capital structure of company. profit making apparatus remains same. There is no addition or alteration to profit making apparatus. total funds available with company will remain same. As result of issue of bonus shares, there will be no change in capital structure of company. Hence, Tribunal was right in holding that Rs. 500 representing application fees paid for issue of bonus shares was not capital expenditure." 13. As per chart stated above issues have been dealt in depth in asst. yr. 1 99 -91 in assessee s appeals and assessee succeeds on all grounds in its own appeals for all assessment years as issues agitated are identical in assessees appeals. 14. Now we shall go to Departmental appeals as per chart given below : Asst. Ground ITA No. Remarks yr. No. EPF & 1 99 allowable 142 to -91 to 1 expenses- 147/Ctk/2003, 99 5-96, 1 1&2 discussed in 205/Ctk/2003 & 99 6-97 & para 5 to 5.14 148/Ctk/2003 1 99 7-98 vide order of 1 99 -91. 1 99 Accounting 142/Ctk/2003 3}common -91 standard 1 99 143 to discussed 1-92 to 1 4} 147/Ctk/2003 in para 5 to 10 99 5-96 1 99 148/Ctk/2003 4} vide order 7-98 & & 205/Ctk/2003 4} of 1 99 -91 1 99 6-97 EPF issue- discussed in 1 99 142/Ctk/2003 4 para 5 to 5.14 -91 vide order of 1 99 -91. CIT(A) deleted addition wrongly 1 99 143 to under s. 43B 1-92 to 1 147/Ctk/2003, when AO 99 5-96, 1 3 common 148/Ctk/2003 & made 99 7-98 & 205/Ctk/2003 addition on 1 99 6-97 basis of cash system of accounting. 1 99 143 to 1-92 to 1 Expenses 147/Ctk/2003, 99 5-96, 1 5 common for guarantee 148/Ctk/2003 & 99 7-98 & bond 205/Ctk/2003 1 99 6-97 1 99 143 to 1-92 to 1 147/Ctk/2003, General in 99 5-96, 1 6 common 148/Ctk/2003 & nature. 99 7-98 & 205/Ctk/2003 1 99 6-97 15. In Departmental appeals filed for asst. yrs. 1 99 -91 to 1 99 7-98 ground Nos. 1 and 2 are identical as stated above relating to addition made on account of unpaid employees contribution to EPF and Department opposed reliance of learned CIT(A) on case laws decided by apex Court in case ofStandard Triumph Co. Ltd.(supra) which according to Revenue has been based on different set of facts and circumstances totally irrelevant and inapplicable to present case. 15.1 As matter has already dealt in depth in asst. yr. 1 99 -91 in assessee s appeal, it requires no more deliberation. However, to clarify position it is analysed in brief again as under. 15.2 As per provisions of s. 2(24)(x) income certainly included sum received by assessee from his employees as contribution to provident fund but as has been narrated earlier, under facts and circumstances of case same is deductible from business income under s. 36(va) as said sum (employees contribution to provident fund scheme) is being credited by assessee to employees account in relevant fund on or before due date. It should not be out of place to mention herein that it has already been clarified by assessee-corporation in this case that assessee-corporation has been excluded from clutches of provident fund authorities and they have been adopting separate provident fund account with prior approval of RBI and State Government and they create liability to employees by making and maintaining separate ledger accounts, by crediting employees provident fund along with employer s contribution to same and keeping in readiness in order to facilitate employees for withdrawal of same as permissible under scheme according to their requirement and necessity. Therefore, Revenue cannot make addition in general terms particularly when they have accepted this method and maintenance of accounts by assessee-corporation right from inception and particularly when there is no grumbling from side of employees in this regard. 15.3 Again, it is not case of Revenue nor Revenue has been able to establish case against assessee-corporation that assessee- corporation has violated norms of provident fund scheme and any proceedings whatsoever has been started against them by authorities administering Provident Fund Act and Rules. So, when Revenue has not established any violation of provident fund scheme by assessee- corporation and assessee-corporation not being profit motive business organisation established by State Government to facilitate loans to small- scale industries has been following particular set of Act and Rules under combined guidelines of RBI and State government, Revenue does not have case to make addition on this score. Accordingly, Revenue does not succeed on these two grounds. 16. next ground relates to challenge of Revenue regarding maintenance of accounting system. factual aspect has already been dealt in 1 99 -91 of assessee s appeal. It is admitted fact that assessee- corporation is Government of Orissa undertaking having checked and restrained by State Government of Orissa and RBI from time-to-time. CAG has also got control over same. Therefore, Revenue should not treat assessee-corporation like ordinary assessee and unnecessarily raise objection on maintenance of accounting system. With this considerate view in favour of assessee-corporation we discard Revenue s contention on this issue. Accordingly, this ground of Revenue also fails. 17. With regard to ground No. 5 raised in asst. yrs. 1 99 1-92 to 1 99 7-98 regarding deletion of expenses for guarantee bond. On this issue it has been found that learned CIT(A) has dealt matter in depth in relevant portion of his order and contentions of assessee-corporation has already been taken into consideration. While deciding issue in asst. yr. 1 99 -91, we are in agreement with deliberation held by learned CIT(A) and not able to approve order of AO for application of s. 35D(2)(c)(iv) because of nature of business undertaken by assessee-corporation it is quite different from that of general assessees. Therefore, application of case laws ofWoodcrafts Industries(supra) will not be justified to present set of circumstances of case. Revenue s ground No. 5 is, therefore, rejected on this score. 18. Even on analysis of factual aspect of case, it has been observed that s. 35D relates to amortisation of preliminary expenses and s. 36(1)(va) relates to employees contribution from employer as per interpretation of s. 2(24)(x), thus, s. 35(2) does not have any application to facts of case of appellant. 18. In result, appeals of assessee are fully allowed and appeals of Department are dismissed. *** ORISSA STATE FINANCIAL CORPORATION v. DEPUTY COMMISSIONER OF INCOME TAX