General and taxation reserves not deductible under Income-tax Act

The High Court of Bombay held that general reserves and taxation reserves cannot be considered as allowable expenditure under the Income-tax Act, 1961. The judgment favored the assessee for the assessment years 1969-70, 1970-71, and 1971-72.

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The High Court of Bombay delivered a judgment on the allowability of general reserves and taxation reserves as expenditure under the Income-tax Act, 1961. The court ruled that neither the taxation reserve nor the general reserve can be considered as an allowance or expenditure. The judgment was in favor of the assessee for the assessment years 1969-70, 1970-71, and 1971-72.

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