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2017 (9) TMI 431 - AT - Income TaxProvision for warranty made @1% of weighted average turnover - AO disallowed the warranty Provisions -Nature of Contingent Liability - Matching Concept - Provision made on scientific estimation keeping in mind the anticipated liabilities likely to arise in the future. - Held That :- matter remitted back to the file of the Assessing Officer to examine the entire details of the provisions made by the assessee in the earlier years and also in the subsequent years and also to see whether such a provision made has some rational and scientific evaluation and no excess provision is being made with this direction. -Appeal of revenue is allowed for statistical purposes. Cash Discounts for early payments - Disallowances on basis of no material evidences - Quantum of Cash Discounts - MUL provided statement of claims of cash discounts of its purchases on weekly basis - Held That:- Tribunal set aside this issue to the file of the Assessing Officer to verify the details of cash discount and if it is found that the customers while making the payment before 30 days have deducted the cash discount, then same is to be allowed. - Appeal of revenue is allowed for statistical purposes.
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