https://www.taxtmi.com/caselaws?id=756918 The ITAT Rajkot ruled in favor of the assessee bank regarding excess payments towards gratuity and leave encashment provisions. The AO had made additions claiming wrong valuation differences between book provisions and actuarial valuations by LIC and SBI Life Insurance. The tribunal held that the bank's provisions were real expenses for the assessment year 2015-16, not hypothetical expenditures, and followed proper accrual accounting. Citing SC precedent in Shoorji Vallabhdas case, the tribunal found that real income is taxable and provisions are legitimate unless specifically prohibited. The AO's findings were deemed perverse and unconnected to the actual accounting treatment. Addition deleted. en-us Wed, 10 Jul 2024 00:00:00 +0530 Sat, 10 Aug 2024 09:57:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=756918 The ITAT Rajkot ruled in favor of the assessee bank regarding excess payments towards gratuity and leave encashment provisions. The AO had made additions claiming wrong valuation differences between book provisions and actuarial valuations by LIC and SBI Life Insurance. The tribunal held that the bank's provisions were real expenses for the assessment year 2015-16, not hypothetical expenditures, and followed proper accrual accounting. Citing SC precedent in Shoorji Vallabhdas case, the tribunal found that real income is taxable and provisions are legitimate unless specifically prohibited. The AO's findings were deemed perverse and unconnected to the actual accounting treatment. Addition deleted. Case-Laws Income Tax Wed, 10 Jul 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=756918