9911796707
TMI Blog1991 (2) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... firm. It is an exporter of fish prawns to foreign countries. We are concerned with the assessment year 1978-79, the accounting period ending on March 31, 1978. A sum of Rs. 1,16,693 was debited in the trading account as the provision for purchase tax liability payable to the Sales Tax Department. The assessee was disputing the liability before the sales tax authorities. There was no formal demand for the liability as against the assessee. But, by notification of the Government of Kerala, G. 0. Ms. No. 54 of 1979 T. D., dated March 29, 1979, the Government had waived the purchase tax liability on sea food goods in the case of all exporters from April 1, 1977, to March 31, 1979. On the basis of the said notification, the assessee will be exon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment year 1978-79 for which the accounting period ended on March 31, 1978. The assessee is a firm. It claimed that the provision made by it in the trading account in the sum of Rs. 1,16,693 towards purchase tax liability is permissible deduction. The Commissioner of Income-tax (Appeals), as also the Tribunal, took the view that, as on the last day of the previous year, i.e., March 31, 1978, when the liability to pay the purchase tax arose, there was no exemption granted to the assessee as per the notification dated March 29, 1919, and so the assessee was bound to pay the purchase tax. So, it was entitled to debit the amount in the account as a provision in respect of purchases made for the year. It is on this basis that the addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egarding the method of accounting adopted by the assessee is absolutely essential before adjudicating the controversy raised in this case. In the absence of materials on that score, we are not in a position to answer the question referred to this court either properly or effectively. We, therefore, decline to answer the question referred to this court, but, at the same time, direct the Incometax Appellate Tribunal to restore the appeal to Me and decide the matter afresh in accordance with law. It is for the Appellate Tribunal to consider the method of accounting adopted by the assessee, i.e., whether the assessee had accepted the liability in sales tax proceedings and how and in what manner the provision is made in the accounts, etc. All as ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
