https://www.taxtmi.com/caselaws?id=13229 The HC allowed the appeal by the Commissioner of Income-tax, setting aside the ITAT's order that favored the assessee. The court ruled that the penalty deduction of Rs. 2,28,336 should have been claimed in the accounting year 1989-90 under the mercantile system, as the liability crystallized then. The Tribunal's decision was deemed unjustified, emphasizing that liabilities must be accounted for in the year they arise, irrespective of subsequent refunds. Legal precedents, including Kedarnath Jute Mfg. Co. Ltd. v. CIT, were considered, reinforcing that liabilities are independent of future assessments. en-us Thu, 08 Jun 2006 00:00:00 +0530 Fri, 23 Feb 2024 15:11:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=13229 The HC allowed the appeal by the Commissioner of Income-tax, setting aside the ITAT's order that favored the assessee. The court ruled that the penalty deduction of Rs. 2,28,336 should have been claimed in the accounting year 1989-90 under the mercantile system, as the liability crystallized then. The Tribunal's decision was deemed unjustified, emphasizing that liabilities must be accounted for in the year they arise, irrespective of subsequent refunds. Legal precedents, including Kedarnath Jute Mfg. Co. Ltd. v. CIT, were considered, reinforcing that liabilities are independent of future assessments. Case-Laws Income Tax Thu, 08 Jun 2006 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=13229