https://www.taxtmi.com/caselaws?id=57717 Section 41(1) applies only where an earlier deduction or allowance has been claimed and a corresponding liability is later remitted or ceases; a credit note covering retained sale proceeds did not fall within that provision because no prior allowance had been obtained, so it was not taxable in the relevant year. Where sale consideration was contractually retained to meet a future sales tax liability, payment of that liability on its accrual under the governing sales tax law was made in discharge of an enforceable contractual obligation and was deductible from income. The revenue challenge therefore failed and the deduction was sustained. en-us Thu, 19 Jul 1984 00:00:00 +0530 Mon, 13 Dec 2010 11:25:39 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=57717 Section 41(1) applies only where an earlier deduction or allowance has been claimed and a corresponding liability is later remitted or ceases; a credit note covering retained sale proceeds did not fall within that provision because no prior allowance had been obtained, so it was not taxable in the relevant year. Where sale consideration was contractually retained to meet a future sales tax liability, payment of that liability on its accrual under the governing sales tax law was made in discharge of an enforceable contractual obligation and was deductible from income. The revenue challenge therefore failed and the deduction was sustained. Case-Laws Income Tax Thu, 19 Jul 1984 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=57717