https://www.taxtmi.com/caselaws?id=36010 Amounts set aside against future contingencies, without an existing or ascertained liability, are treated as reserves rather than provisions for capital computation under rule 1 of the Second Schedule to the Companies (Profits) Surtax Act, 1964. On that approach, a reserve for depreciation on investments was regarded as part of the company's capital structure because no actual depreciation or present liability was shown, and a reserve for doubtful debts was also treated as a reserve where the amount retained exceeded the identifiable doubtful debts and was not linked to a known liability. The operative distinction is between a provision for accrued liability and an amount kept apart for future use. en-us Thu, 15 May 1980 00:00:00 +0530 Thu, 18 Mar 2010 17:52:11 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=36010 Amounts set aside against future contingencies, without an existing or ascertained liability, are treated as reserves rather than provisions for capital computation under rule 1 of the Second Schedule to the Companies (Profits) Surtax Act, 1964. On that approach, a reserve for depreciation on investments was regarded as part of the company's capital structure because no actual depreciation or present liability was shown, and a reserve for doubtful debts was also treated as a reserve where the amount retained exceeded the identifiable doubtful debts and was not linked to a known liability. The operative distinction is between a provision for accrued liability and an amount kept apart for future use. Case-Laws Income Tax Thu, 15 May 1980 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=36010