https://www.taxtmi.com/caselaws?id=21274 Under mercantile accounting, a disputed liability becomes deductible when it is quantified, accepted and made legally enforceable in the relevant year. The assessee's provision for enhanced land revenue, rent and cess related to earlier disputes with the State, but the obligation was determined, communicated, accepted by agreement, and booked in the previous year relevant to the assessment year. It was therefore not a mere contingent liability or one confined to earlier years. The court held that the liability accrued in that year and was allowable as a deduction in the assessment year in question. en-us Tue, 08 Aug 1989 00:00:00 +0530 Sat, 21 Nov 2009 12:01:13 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=21274 Under mercantile accounting, a disputed liability becomes deductible when it is quantified, accepted and made legally enforceable in the relevant year. The assessee's provision for enhanced land revenue, rent and cess related to earlier disputes with the State, but the obligation was determined, communicated, accepted by agreement, and booked in the previous year relevant to the assessment year. It was therefore not a mere contingent liability or one confined to earlier years. The court held that the liability accrued in that year and was allowable as a deduction in the assessment year in question. Case-Laws Income Tax Tue, 08 Aug 1989 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=21274