2012 (5) TMI 652

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....ad misunderstood the amount added back the amount wrongly. 6. The learned DR pointed out that in the course of hearing before the CIT the AR had advanced fresh contention that the difference of Rs. 59,45,326/- represents impairment of certain assets in accordance with the Accounting Standard - 28, which the company has followed. The learned DR submitted that the assessee could not produce evidence towards impairment of assets and has failed to substantiate the discrepancy of Rs. 59,45,326/- and the assessee has taken advantage of excess depreciation claim by adding back a figure which is less than the figure actually debited to the P&L Account by a margin of Rs. 59,45,326/-. 7. In our opinion this matter can easily be verified by the asse....

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....red by excavating of ore. Therefore it is an accrued liability which is to be estimated and provided in the books of accounts. 9. The learned counsel for the assessee has relied upon the following cases:- i) The Supreme Court in the case of Bharath Earth Movers Limited Vs CIT reported in 245 ITR 428, has held that provisions made for leave encashment which has accrued every year, eventhough the ultimate liability can be determined only at a later point of time, is an allowable deduction. ii) Similarly the Apex Court in the case of Rotork Controls India (P) Ltd v CIT reported in 314 ITR 62 has held that provision made towards warranty, even if made on an estimated basis, should be allowed as a deduction in the year in which sale was made.....