https://www.taxtmi.com/caselaws?id=75721 Estimated warranty service costs debited to the profit and loss account were treated as an accrued liability, not a contingent liability, where the assessee consistently claimed the deduction, maintained a full-scale service department, and followed a settled method for estimating warranty-related expenses. Applying the mercantile system of accounting, the court accepted that an estimated liability already accrued, though payable later, is deductible as expenditure. The provision was therefore allowable, and the Revenue's appeals failed. en-us Fri, 08 Aug 2008 00:00:00 +0530 Thu, 31 Jan 2013 16:32:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=75721 Estimated warranty service costs debited to the profit and loss account were treated as an accrued liability, not a contingent liability, where the assessee consistently claimed the deduction, maintained a full-scale service department, and followed a settled method for estimating warranty-related expenses. Applying the mercantile system of accounting, the court accepted that an estimated liability already accrued, though payable later, is deductible as expenditure. The provision was therefore allowable, and the Revenue's appeals failed. Case-Laws Income Tax Fri, 08 Aug 2008 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=75721