1995 (5) TMI 10 - HC - Income Tax

Summary

The High Court dismissed the Revenue's petition under section 256(2) of the Income-tax Act, 1961, as the issue regarding sales tax liability had already been settled by a Division Bench decision. The addition to the declared income of the assessee was not justified as per the decision in Sirsa Industries' case [1984] 147 ITR 238 (P & H), which had been reversed. The Tribunal's decision was upheld, and the Revenue's application for reference was rejected. The court found that deduction is claimable only in the year in which the liability accrues for an assessee following the mercantile system of accounting.