https://www.taxtmi.com/caselaws?id=36606 A statutory gratuity liability that arose during the accounting year was treated as an accrued business expense under mercantile accounting principles. The Court held that profits must be computed after charging liabilities that have genuinely accrued, even if payment is deferred, and that a provision based on reliable actuarial valuation is deductible where the liability is real rather than remote. It further held that contingencies defeating payment were too remote to prevent accrual in substance. The gratuity provision was therefore allowable as a revenue deduction in computing business profits. en-us Sat, 07 Jun 1980 00:00:00 +0530 Tue, 23 Mar 2010 13:25:27 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=36606 A statutory gratuity liability that arose during the accounting year was treated as an accrued business expense under mercantile accounting principles. The Court held that profits must be computed after charging liabilities that have genuinely accrued, even if payment is deferred, and that a provision based on reliable actuarial valuation is deductible where the liability is real rather than remote. It further held that contingencies defeating payment were too remote to prevent accrual in substance. The gratuity provision was therefore allowable as a revenue deduction in computing business profits. Case-Laws Income Tax Sat, 07 Jun 1980 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=36606