9911796707
TMI Blog1974 (6) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... its and gains of the assessee's business for purposes of assessment for the assessment years 1962-63 and 1963-64 ? " The assessee is a private limited company operating a bus transport. It follows the mercantile system. For the assessment years 1962-63 and 1963-64, the assessee made provision for payment of bonus to its employees to the extent of Rs. 1,63,503 and Rs. 1,79,000, respectively. The amounts were shown under " liabilities for expenses " under the head, "contingency account " and the assessee deducted these amounts from the income returned for the respective years. The Income-tax Officer held that these amounts were only provisions and not an ascertained liability and that, therefore, it was not an allowable claim. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground that, in that case, the emphasis was on the absence of any basis for making that provision of Rs. 1,50,000, but, on the other hand, in the case on hand, the Tribunal has definitely found on the basis of the evidence shown, that the amount was arrived at on a particular basis. It is true that we have referred to the absence of definite basis in our earlier judgment in Commissioner of Income-tax v. Somasundaram Mills (P.) Ltd. But that was for the purpose of repelling the contention that for a long number of years the assessee therein had been adopting a particular basis on which bonus was paid and that amounted to an implied agreement between the assessee and its employers. We have noticed that the basis was not uniform in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finite and ascertained liability and not a mere provision for a possible contingent liability. The learned counsel also stated that the point referred to us did not involve the question as to whether there is an accrued liability or not and the finding of the Tribunal that it was with reference to an accrued liability is a finding of fact and that not having been specifically challenged by a separate reference, it is not open to us to go into the same. We are unable to accept this contention. The first part of the ques tion referred specifically requires us to answer as to whether the Tribunal was right in holding that the sums in question represented liability of the assessee-company. That is directly a question as to whether it is an accr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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