9911796707
TMI Blog2007 (9) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax Act, 1961('Act'): "Whether on the facts and in the circumstances of the case, the liability to pay the sales tax of Rs.4,24,029/- made up of Rs.3,22,482/- being refund of sales tax received by the assessee during the relevant year and Rs.1,01,507/- being provision for sales tax made in the accounting period relevant to the assessment year 1976-77, was chargeable to tax to the total income of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the mercantile system of accounting. Initially there was some dispute whether the ice cream sold by the assessee was exigible to tax or not. This Court in its judgment dated 27th March, 1974 held that the ice cream manufactured and sold by the assessee was not exigible to sales tax. The Revenue was not satisfied with the decision rendered by this Court and preferred an appeal which remained pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that since the assessee did not in fact pay any sales tax on the sale of ice cream in the relevant previous year, there was no question of any provision for sales tax being made. 2. Learned counsel for the Assessee has drawn our attention to the decision of the Supreme Court in Kedarnath Jute Manufacturing Co. Limited v. Commissioner of Income Tax [1971] 82 ITR 363 wherein it has been held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed v. O.S. Bajpai, ITO,m Central Circle-V, Kanpur [1976] 105 ITR 864 has held that an assessee is entitled to claim deduction in respect of the liability of excise duty for which it had made a provision in its account books. This view was upheld by the Hon'ble Supreme Court in Union of India v. J.K. Synthetics Limited [1993] 199 ITR 14. The Supreme Court held that since under Section 41 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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