TaxTMI 
TaxTMI 
2011 (1) TMI 85
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.... by it from J&K Bank as accrued and ascertained liability in respect of the year in question? 2. Whether on the facts and in the circumstances of the case, the Tribunal is justified in law in upholding disallowance of Rs.50,000/- on estimate basis against a claim of Rs.1,48,782/- being expenses on cartage, labour and sealing expenses and without any material on record against the assessee?" 2. Insofar as the first question is concerned, we feel the following facts are required to be taken note of: 3. The assessee had taken a credit facility from J&K Bank Ltd („the Bank‟ for short). On the closing balance of Rs.1,11,40,966/-, the assessee claimed that interest amounting to Rs.16,59,292/- as deduction on accrual basis. The Asses....
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....claimed as an expenditure only if it is, firstly, ascertained and secondly, it is paid. He further submits that even if this Court was to come to a conclusion that it is an ascertained liability and not a contingent liability as viewed by the authorities below; since the interest had not been paid, the assessee could not claim a deduction as contended. 5.1 On the other hand, learned counsel for assessee in support of his contention submitted that the deduction of accrued interest ought to be allowed as it was an ascertained liability. The mere fact that the liability is not quantified will not render it contingent. 6. We need not burden ourselves with the reasoning given by the authorities below as in our view this issue has been adequate....
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.... basis of payment. We may also notice that the learned counsel for the Department has not been able to bring to our notice any finding of authorities below that the assessee has not paid the interest for the relevant period. 8. In these circumstances, the question of law is answered in favour of the assessee and against the department. The only caveat, we would like to enter, is that, the Assessing Officer will ascertain the veracity of the statement made before us by the learned counsel for the assessee at the time of final assessment carried for the assessment year 1992-1993. 9. Insofar as the second question is concerned, it involves dis-allowance of expenses to the extent of Rs.50,000/- as against an amount of Rs.1,48,782/- claimed by....