JUDGMENT :- CHITRA VENKATARAMAN,J 1. The Revenue is on appeal as against the order of the Income Tax Appellate Tribunal. The only question of law raised by the Revenue for the assessment year 1989-90 is as follows:- "Whether in the facts and circumstances of the case, the Tribunal had enough material and was right in holding that the provisions of Section 40A(7)(b) was applicable to the assessee's case?" 2. The assessee herein filed a return wherein it claimed deduction for a sum of Rs.32,62,863/- being the provision made in the accounts for the purpose of meeting out its gratuity liability in respect of those employees who had resigned or retired on Voluntary Retirement Scheme. It is stated that the assessee became a sick company, consequently, it offered Voluntary Retirement Scheme, according to which gratuity was payable in respect of employees who had resigned or retired. Basing its claim on Section 40A(7)(b)(i) of the Income Tax Act, the assessee claimed deduction on the ground that it had made the provision for the purpose of payment of gratuity under the scheme. The Assessing Officer, rejected the claim of the assessee. As against the rejection, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) who agreed with the assessee's contention and allowed the appeal. 3. As against the same, the Revenue went on appeal before the Income Tax Appellate Tribunal. It reaffirmed the view of the Commissioner of Income Tax (Appeals); consequently, the appeals were dismissed. Aggrieved by the same, present appeal by the Revenue. 4. Learned counsel for the Revenue submitted that when the assessee had not established as a fact, the payment of gratuity, which is allowable deduction under Section 43(b), the Tribunal committed serious error in allowing the claim of the assessee. Aggrieved by the same, present appeal by the Revenue. 4. Learned counsel for the Revenue submitted that when the assessee had not established as a fact, the payment of gratuity, which is allowable deduction under Section 43(b), the Tribunal committed serious error in allowing the claim of the assessee. Section 40 A(7) sub clause (a) and (b) reads as follows:- "40A(7)(a) Subject to the provisions of clause (b), no deduction shall be allowed in respect of any provision (whether called as such or by any other name) made by the assessee for the payment of gratuity to his employees on their retirement or on termination of their employment for any reason- (b)Nothing in clause (a) shall apply in relation to (i) any provision made by the assessee for the purpose of payment of a sum by way of any contribution towards an approved gratuity fund, or for the purpose of payment of any gratuity, that has become payable during the previous year. " 5. Section 43B of the Act is a specific provision which speaks about the granting of deduction on actual payment. Thus, while Section 40A (7) of the Act deals with deduction on the provision made, Section 43B of the Act is withreference to the deduction on actual payment. As far as the present case is concerned, the assessee's case falls under Section 40A(7) of the Act. The Revenue's contention is that the assessee had not let in any evidence to show that the amount payable qualified for deduction under Section 40A(7) (b)(i) of the Act. 6. As already pointed out, a reading of the order of the authorities below shows that in view of its sickness, the assessee brought in a Voluntary Retirement Scheme, under which, it offered to pay gratuity to those who went in for Voluntary Retirement or resigned. Taking note of the number of persons who had volunteered to retire or resign, the total liability was qualified by the assessee was to the tune of Rs.32,63,863/-, which was the actual amount payable during the relevant accounting year. Thus, the assessee made a provision in respect of the said amount, quantified with reference to the number of persons opting to take advantage of the Voluntary Retirement Scheme. Thus, the assessee made a provision in respect of the said amount, quantified with reference to the number of persons opting to take advantage of the Voluntary Retirement Scheme. Given the fact that Section 40A(7)(b) of the Act contemplates deduction in respect of the provision made, not only for the purpose of contribution towards the approved gratuity fund, but equally so for the purpose of payment of gratuity payable during the year, rightly the Commissioner of Income Tax (Appeals) granted the relief. With the above said fact remaining undisturbed, the Tribunal considered the said contention for granting relief to the assessee. 7. Going by the provision under Section 40A(7)(b), considering the deduction both in the case of contribution of approved gratuity fund as well as to a case of provision for payment of gratuity that has been payable during the relevant previous year, we have no hesitation in confirming the order of the Tribunal. 8. Consequently, the order of the Tribunal is confirmed, the Tax Case Appeal is allowed. No costs.