Report No. 12

307. Conditions for approval.-

(1) In order that a superannuation fund may receive and retain approval, it shall satisfy the conditions set out below and any other conditions which the Central Government may, by rules, prescribe-

(a) the fund shall be a fund established under an irrevocable trust in connection with a trade or undertaking carried on in India;

(b) the fund shall have for its sold purpose the provision of annuities for employees in the trade or undertaking on their retirement at or after a specified age or on their becoming incapacitate prior to such retirement, or for the widows, children or dependants of persons who are or have been such employees on the death of those persons; and

(c) the employer in the trade or undertaking shall be a contributor to the fund,

[Section 58P, main para]

(2) The Central Board of Revenue may, if it thinks fit and subject to such conditions, if any, as it thinks proper to attach to the approval, approve a fund or any part of a fund-

(i) notwithstanding that the rules of the fund provide for the return in certain contingencies of contributions paid to the fund, or

(ii) if the main purpose of the fund is the provision of such annuities, as aforesaid, notwithstanding that such provision is not its sole purpose, or

(iii) notwithstanding that the trade or undertaking in connection with which the fund is established is carried on only partly in India.

[Section 58P, proviso]

(3) Where there is a repugnance between any rules of an approved superannuation fund or the terms of the instrument under which the fund is established and any provision of this Chapter or of the rules made thereunder, the rules of the fund or the terms of the instrument under which the fund is established, as the case may be, shall, to the extent of the repugnance, be of no effect; and the Central Board of Revenue may at any time require that such repugnance shall be removed from the rules of the fund or the terms of the instrument, as the case may be.