https://www.taxtmi.com/caselaws?id=26689 For surtax capital computation under the Second Schedule to the Companies (Profits) Surtax Act, 1964, an appropriation out of profits is a reserve unless it is shown to meet a known or existing liability, contingency, commitment, or diminution in asset value at the balance-sheet date. On that test, the deferred taxation reserve was treated as created without reference to any specific existing liability and was includible in capital. The doubtful debts reserve was also treated as an appropriation for future contingencies rather than a quantified provision for an existing liability, and was likewise includible in capital. Both issues were answered in favour of the assessee. en-us Wed, 30 Oct 1985 00:00:00 +0530 Sat, 06 Feb 2010 17:34:52 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=26689 For surtax capital computation under the Second Schedule to the Companies (Profits) Surtax Act, 1964, an appropriation out of profits is a reserve unless it is shown to meet a known or existing liability, contingency, commitment, or diminution in asset value at the balance-sheet date. On that test, the deferred taxation reserve was treated as created without reference to any specific existing liability and was includible in capital. The doubtful debts reserve was also treated as an appropriation for future contingencies rather than a quantified provision for an existing liability, and was likewise includible in capital. Both issues were answered in favour of the assessee. Case-Laws Income Tax Wed, 30 Oct 1985 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=26689