9911796707
TMI Blog1998 (3) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... is carrying on insurance business and was assessed in the status of an association of persons. In computing the income of the assessee for the assessment year 1973-74, the relevant accounting year ended on December 31, 1972, the assessee made a provision of Rs. 44,541 towards bonus and claimed the same as deduction from its business income in addition to the claim for deduction of actual payment of bonus. The claim of the assessee for deduction of the provision was made on the basis that the assessee-company got merged with the General Insurance Corporation during the course of the calendar year 1972 and, therefore, it made a provision for bonus as it was the last year of its business. The Income-tax Officer rejected the claim of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee had been claiming deduction towards bonus allowance on the basis of the actual payment and it was allowed and it is not permissible for the assessee to make the claim on the basis of the provision for bonus in addition to the claim for deduction of actual payment made by the assessee, and if the claim of the assessee for actual payment and the provision for bonus are allowed, it would distort the income of the assessee and, therefore, the Tribunal was not justified in allowing both the claims of the assessee. Learned counsel for the assessee supported the order of the Income-tax Appellate Tribunal. We have carefully considered the submissions of learned counsel. The Revenue has not disputed the fact that the assessee wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee from claiming deduction as it cannot be said that there was a double deduction as the double deduction postulates the deduction of the same amount and it cannot be said that the assessee is claiming double deduction of the same amount one by way of actual payment and another by way of provision for bonus. The assessee made a provision for the bonus in addition to the actual payment on the ground that the liability had accrued to the assessee during the accounting year as it happened to be the last accounting year of the assessee's business and, therefore, in our opinion, the assessee is entitled to claim deduction of the actual payments made as well as provision for bonus made during the accounting year. We are, therefore, of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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