NATIONAL RAYON CORPN LTD Vs. DEPUTY COMMISSIONER OF INCOME TAX
INCOME TAX APPELLATE TRIBUNAL
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K.C. Singhal, Judicial Member -
(1.) THESE are two appeals, one by the assessee against the order of the CIT(A) dated 26-1-1993 while the revenue's appeal is against the order of the CIT(A) passed under Section 154 dated 10-1-1994.
(2.) Ground Nos. 1 to 3 and 12 to 14 in assessee's appeal as well as ground raised by the revenue involve common issue and, therefore, are being disposed of by this common order.
The issue involved is regarding the ascertainment of liability in respect of power charges payable to Maharashtra State Electricity Board for the purpose of computation of income under Section 28 as well as Section 115J.
(3.) THE brief facts of the case are that the assessee-company during the assessment year 1990-91 had made provision of Rs. 3.81 lakhs in its books of account in respect of liability relating to power charges amounting to Rs. 220.01 lakhs and liability of interest thereon amounting to Rs. 80.81 lakhs. THE liability admittedly does not pertain to the year in question but pertains to the earlier years, i.e., 1983 onwards. THE assessee while computing its income claimed this liability as deduction out of the profits of the current year. Similarly for the computation of book profits under Section 115J the assessee excluded this liability as according to it, this liability was ascertained liability within the meaning of Section 115J -Explanation (c).;
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