https://www.taxtmi.com/caselaws?id=36162 For super profits tax capital computation, the decisive test was whether amounts set aside out of profits were reserves or provisions. Terminal pay, bad and doubtful debts, staff gratuity, and tax-exempt dividend amounts were treated as reserves because they were not shown to meet any known or existing liability, so they were includible in capital. The proposed dividend amount was a provision for a specific liability to distribute profits and was therefore excluded from capital. The ruling restated that a provision arises only for an identified liability, even if the exact amount cannot be determined with precision; otherwise, the amount remains a reserve. en-us Wed, 24 Jan 1979 00:00:00 +0530 Fri, 19 Mar 2010 16:46:16 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=36162 For super profits tax capital computation, the decisive test was whether amounts set aside out of profits were reserves or provisions. Terminal pay, bad and doubtful debts, staff gratuity, and tax-exempt dividend amounts were treated as reserves because they were not shown to meet any known or existing liability, so they were includible in capital. The proposed dividend amount was a provision for a specific liability to distribute profits and was therefore excluded from capital. The ruling restated that a provision arises only for an identified liability, even if the exact amount cannot be determined with precision; otherwise, the amount remains a reserve. Case-Laws Income Tax Wed, 24 Jan 1979 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=36162