9911796707
TMI Blog1985 (8) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. Rs. Secured considered good : Outstanding for a period exceeding six months 24,022 Others 4,70,380 ------------------ 4,94,402 Unsecured : Outstanding for a period exceeding six months : Considered good 3,21,385 Considered doubtful 8,41,866 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... --------------------- 24,81,131 Less : Provision for doubtful advances 75,382 --------------------- 24,05,749 Deposit with Industrial Development Bank of India under the Companies Deposits (Surcharge on Income-tax) Scheme, 1976 (including interest accrued Rs. 30,680 previous year Rs. 14,965) 2,92,595 T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovision', which could not be included in the capital for the purpose of determining the surtax liability under the Act. Proceeding further, he pointed out that even according to the balance sheet of the assessee-company and the Schedules of the Act annexed thereto, the provision for doubtful debts as well as the provision for doubtful advances was not only called a 'provision' and not a 'reserve' by the assessee-company itself, it was exactly of the identical amount out of the unsecured sundry debtors and unsecured loans and advances, which were considered by the assessee-company to be doubtful on the date of the balance sheet, unlike the other amounts, which were considered good. 4. In these circumstances, both of these amounts were to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. Shri Dastur filed before us copies of the orders of the Tribunal in the assessee's own case for the assessment years 1976-77 and 1977-78 [ST Appeal Nos. 53 and 54 (Bom.) of 1981] and 1978-79 [ST Appeal No. 54 (Bom.) of 1982] where the Tribunal had held that the provision for doubtful debts and the provision for doubtful advances should be included in the capital computation for the purpose of determining the surtax liability under the Act. Shri Dastur submitted to us that the facts for the earlier three years were identical to those for the year under appeal and, therefore, there was no reason why we should not follow our order for the earlier three years particularly in the assessee's own case. He, therefore, vehemently argued before u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decided by the Tribunal on a consideration of the factual position following the principles laid down by the Hon'ble Supreme Court and, therefore, no question of law arose out of the order of the Tribunal. This ruling of the Hon'ble Bombay High Court, therefore, is of no help to us in the present case. In the other case of Goodlass Nerolac Paints Ltd. decided by the Hon'ble Bombay High Court, the amount transferred to the reserve for doubtful debts had been determined ad hoc without reference to any specific anticipated liability and without any meticulous calculation of chances of recovery unlike in the present case where the amount transferred to provision for doubtful debts and provision for doubtful advances was the identical amount, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these two amounts of provision for doubtful debts and provision for doubtful advances were mere provisions, which could not be treated as reserves and consequently, could not be included in the capital computation for the purpose of determining the surtax liability under the Act. On this issue, therefore, the order of the Commissioner (Appeals) appears to be incorrect and is hereby reversed. 7. Before we close, we would like to place on record our deep appreciation of the very able manner in which both, the learned departmental representative, Shri Mahadeshwar, as well as the assessee's learned counsel, Shri Dastur, put forward their respective arguments. 8. The appeal filed by the revenue succeeds and is hereby allowed. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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