https://www.taxtmi.com/caselaws?id=277108 Estimated future development expenditure was held not deductible in computing the year's taxable profits because the liability had not accrued in definite and ascertainable form. The court applied the Income-tax Act scheme and ruled that general commercial principles cannot justify a deduction outside statutory allowances. Even under mercantile accounting, only accrued and quantified liabilities may be debited; a contingent or floating obligation dependent on future performance, and not yet fixed in amount, is not an allowable expense. The claimed development outlay was therefore disallowed for the accounting year, and the reference was answered against the assessee. en-us Fri, 26 Jun 1953 00:00:00 +0530 Sat, 24 Nov 2018 13:11:36 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277108 Estimated future development expenditure was held not deductible in computing the year's taxable profits because the liability had not accrued in definite and ascertainable form. The court applied the Income-tax Act scheme and ruled that general commercial principles cannot justify a deduction outside statutory allowances. Even under mercantile accounting, only accrued and quantified liabilities may be debited; a contingent or floating obligation dependent on future performance, and not yet fixed in amount, is not an allowable expense. The claimed development outlay was therefore disallowed for the accounting year, and the reference was answered against the assessee. Case-Laws Income Tax Fri, 26 Jun 1953 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277108