2012 (2) TMI 527

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....E R The present appeals by the Revenue under Section 260A of the Income Tax Act relate to assessment years 2003-04 and 2005-06. The only  contention and issue raised is whether the provision for maintenance costs can be claimed as an expense under Section 37 of the Income Tax Act, 1961(?Act? for short). The reasoning given by the Tribunal reads as under: On due consideration of the f....

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....rting from 2002-03 upto 2007-08 in a tabular form at page 3 of the paper book. We find that there is decreasing trend in the closing balance on this provision. The accounting treatment as well as allowability of such maintenance expense on accrual basis was accepted in the past by the Auditor including CAG as well as by the income Tax Department. There is no sound reasoning assigned by the AO in t....

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....th effect from assessment year 2007-08 the respondent-assessee has changed the method of accounting and is no longer making any provision for maintenance cost. Learned counsel for the respondent-assessee states that change was made to avoid further confusion or litigation and it was not making any difference in the taxable income. It is therefore clear that this issue does not have any recurring e....