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TMI Blog1990 (11) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... atter is further heard. In this reference under section 256(1) of the Income-tax Act, 1961, for the assessment year 1978-79, the following question of law has been referred to this court : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the additional corporation tax of Rs. 6,22,718 was allowable as deductions in this year ?" Shortly stated, the facts are that the assessee claimed a sum of Rs. 10,82,484 being expenditure relating to earlier years for which liability was stated to have arisen during the accounting period. This amount included short provision of Rs. 8,57,106 for corporation tax. It was explained that the corporation proposed enhancement of valuation with effect fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccording to the assessee for the said period from the third quarter of 1969-70 to the third quarter of 1971-72 worked out to Rs. 6,77,570 and against this the assessee had already paid and provided in its books of account Rs. 4,63,182. The balance amount of Rs. 2,14,388 was claimed by the assessee in this year under consideration. The Income-tax Officer further "noticed that the assessee did not claim this expenditure last year because the assessee wanted to have the set off of brought forward deficiency of section 801 relief from earlier years from its income for that year which would otherwise have lapsed. He was of the opinion that the provision claimed for the fourth quarter of 1971-72 to the end of the earlier accounting year did not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was also some confusion as regard the nature of the notice, viz., whether it was a show cause or a notice for final assessment upon hearing the objections which is usually communicated to the assessee by the corporation after hearing the objections by a postcard commonly known as the red card. It is only the year in which such red card was received by the assessee although the revised assessment might have been made earlier which would be the crucial factor in determining the question whether the allowance will be allowed in the year under reference or not. The Tribunal found that the demand notices upon revision of assessment were received by the assessee during the previous year in question. For the aforesaid reasons, the question in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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