9911796707
TMI Blog1990 (5) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... ss of Rs. 17,726 in the concrete unit was allowable ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was in law justified in holding that the addition of Rs. 1,93,370 made by the Income-tax Officer in valuing the closing stock of barbed wire was uncalled for ?" Upon hearing learned counsel for the parties, in our opinion, question No. 1 alone is a question of law and the remaining two questions are concluded by findings of fact and do not give rise to any question of law. The brief facts relevant to the first question are these : The assessee was following the mercantile system of accounting. Out of the sums debited to the profit and loss account under the head "Interest payable to the State of U. P.", th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the assessee. In other words, the liability to pay interest arises with the user of the capital. The appellate authority also observed that the rate of interest finally settled may be more or may be less but it does not affect the claim of the assessee, for, if an excess claim is allowed, the same can be brought to tax in the subsequent year and, conversely, if there was any deficiency the same can further be allowed in the year in which the terms of the loan were settled. It is on these facts that the first question has been suggested in this application. Generally speaking, a contingent liability is not expenditure and, therefore, cannot be the subject-matter of deduction even under the mercantile system of accounting. It is evi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icient material on record to allow the claim of the assessee. Accordingly, the claim was allowed. Now, the question whether, on the above facts, the Income-tax Appellate Tribunal was justified in holding that the loss in the concrete unit was allowable is a pure finding of fact. The Tribunal which is the final fact-finding authority, on the material placed before it, felt satisfied that the assessee was able to discharge its burden in proving the loss that it suffered. This, in our opinion, was the end of the matter. The prayer with regard to the second question is, accordingly, rejected. Regarding question No. 3, a sum of Rs. 1,93,370 was added by the Income-tax Officer in valuing the closing stock of the assessee in respect of barbed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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