Sen, J. - (1.) The facts found and/or admitted in these proceedings are shortly as follows. Messrs. Ashoka Cement Ltd., the assessee, carries on business in the manufacture and sale of cement and maintains its accounts on the mercantile basis. In the course of its business, the assessee collects from its customers sales tax payable respectively under the Bihar Sales Tax Act and the Central Sales Tax Act.
(2.) In the assessment year 1962-63, the relevant previous year ending on the 31st March, 1962, the ITO in the course of assessing the assessee to income-tax found that in the accounts of the assessee, the credit balance under the head "Bihar sales tax" amounted to Rs. 81,036 after adjusting Rs. 69,146, being the balance in the earlier year. The difference of Rs. 11,890 was found to have been collected by the assessee in the year in question. As in the earlier year, the ITO added back the said amount in computing the income of the assessee. Credit balance under the head "Central sales tax" was found to be Rs. 9,072 at the close of the accounting year, without any debit during the year, and the said amount was similarly added back.
(3.) Being aggrieved, the assessee appealed to the AAC, who confirmed the additions holding that the amounts collected as sales tax were part of the turnover of the assessee and that the assessee would only be entitled to a deduction when sales tax would actually be paid and/or would become an ascertained liability.;