2023 (5) TMI 1096 - AT - Income Tax

Nature of liability - Adhoc provisions on account of contingent liabilities or ascertained liabilities - CIT-A deleted the addition - HELD THAT:- AO has erred in holding provision for unsettled claims as contingent liability. We find that ld. CIT (A) has passed correct order which does not need any interference from us. The liability in this regard is duly ascertained. Hence, this ground raised by the Revenue is dismissed.

Disallowance for provision for IBNR claims as contingent liability - CIT-A deleted the addition - HELD THAT:- We find that ld. CIT (A) has taken correct decision, which does not need any interference on our part. The case law from Kolkata Bench of ITAT in the case of DCIT vs. National Insurance Co. Ltd [2011 (10) TMI 669 - ITAT KOLKATA] duly holds that these are ascertained liabilities. Hence, we uphold the order of ld. CIT (A). Decided against revenue.