1980 (4) TMI 199

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.... 2. The first common ground for the asst. yr. 1970-71 to 1974-75 is that the reserve for bad and doubtful debts should not be treated as a reserve for the purpose of capital computation. The CIT (Appeals) has accepted the assessee's claim for treating it as a reserve for the purpose of capital computation on the basis of the decision of the Bombay High Court in the case of Golden Tobacco Co. Lt....

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....ut than we cannot but follow it and uphold the order of the CIT (Appeals) on this point also. 4. The third common point in the asst. yr. 1971-72 to 1974-75 is that the dividends proposed in respect of the accounting year out of the general reserve should be deducted from capital for the purpose of assessment to sur-tax. On this point also there are two decisions of the Madras High Court in favo....

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....that the audit note merely drew the attention of the ITO to the relevant provision of the Act and did not express any opinion on that. According to the Revenue the information supplied by the audit party was only the fact of the existence of the statutory provisions which the ITO had apparently overlooked. The question of reopening is not of much importance in the asst. yrs. 1971-72 and 1972-73 wh....