https://www.taxtmi.com/caselaws?id=28956 Amounts credited in accounts were classified for capital computation under rule 1 of the Second Schedule to the Super Profits Tax Act by their true commercial character. The profit and loss account surplus was treated as a provision, not a reserve, and the provision for taxation was likewise excluded from reserve treatment. By contrast, the gratuity provision was treated as a reserve because the ad hoc additions were not tied to a contemporaneous liability, and the excess in the development rebate reserve was also treated as a reserve under the applicable CBDT circular and the authority applied. The reference was thus split, with two issues decided against the assessee and two in its favour. en-us Tue, 01 Sep 1981 00:00:00 +0530 Tue, 09 Mar 2010 10:37:58 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=28956 Amounts credited in accounts were classified for capital computation under rule 1 of the Second Schedule to the Super Profits Tax Act by their true commercial character. The profit and loss account surplus was treated as a provision, not a reserve, and the provision for taxation was likewise excluded from reserve treatment. By contrast, the gratuity provision was treated as a reserve because the ad hoc additions were not tied to a contemporaneous liability, and the excess in the development rebate reserve was also treated as a reserve under the applicable CBDT circular and the authority applied. The reference was thus split, with two issues decided against the assessee and two in its favour. Case-Laws Income Tax Tue, 01 Sep 1981 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=28956