9911796707
TMI Blog1988 (11) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... -Tarlok Chand Des Raj and Company, the assessee, had a wholesale and retail vend licence. The assessee had deposited an amount of Rs. 1,20,300 as security with the State Government for lifting the stipulated quantity of liquor for sale. The Excise Department of the State Government forfeited the aforesaid security amount. During the assessment proceedings for the assessment year 1969-70, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l year 1968-69 and as per the excise authority's letter dated July 16, 1974, the full amount of security stands already adjusted against the annual licence fee arrears as aforesaid." On the direction of this court, the Tribunal has referred the following question for our opinion: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in allowing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be entitled to claim deduction in the accounting year in which the order is passed, but until there is an order of forfeiture of the security, the assessee cannot claim deduction of the same as a permissible expenditure. Once the High Court deleted the adjustment of the security amount against the arrears of the licence fee, the assessee was entitled to the refund of the same but if there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dues, the assessee would be justified in claiming the amount as permissible expenditure in the assessment year relating to the year in which such an order was passed. Accordingly, we are of the opinion that the Tribunal erred in allowing the security amount of Rs. 1,20,300 as permissible expenditure in computing the assessee's income for the assessment year in question and we answer the question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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