https://www.taxtmi.com/caselaws?id=36363 Amounts set apart for bad and doubtful debts and for gratuity were held to be provisions, not free reserves, for capital computation under the Second Schedule to the Companies (Profits) Surtax Act, 1964. The bad debt item was treated as an anticipated diminution in asset value arising from unrealised debts, while the gratuity item represented an ascertained staff liability shown under liabilities and provisions. Because neither amount was available for general business use as a reserve, both were excluded from capital computation and the reference was answered against the assessee. en-us Mon, 12 Jan 1981 00:00:00 +0530 Mon, 22 Mar 2010 10:15:43 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=36363 Amounts set apart for bad and doubtful debts and for gratuity were held to be provisions, not free reserves, for capital computation under the Second Schedule to the Companies (Profits) Surtax Act, 1964. The bad debt item was treated as an anticipated diminution in asset value arising from unrealised debts, while the gratuity item represented an ascertained staff liability shown under liabilities and provisions. Because neither amount was available for general business use as a reserve, both were excluded from capital computation and the reference was answered against the assessee. Case-Laws Income Tax Mon, 12 Jan 1981 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=36363