1994 (7) TMI 72

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....d counsel for the Revenue and also learned counsel for the assessee. Learned counsel for the Revenue seeks the following questions to be referred by this court : "1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law to hold that it was a clear liability and thus allowable as deduction ? 2. Whether, on the facts and in the circums....

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....ccount of difference in cane price actually paid by the assessee and the one fixed by the Central Government. The assessee, however, did not pay the enhanced price and on a writ petition, succeeded in securing a decision of the High Court, Allahabad, in its favour. The Central Government, in its turn, preferred an appeal before the Supreme Court. Since the assessee-company had not paid the differe....

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.... a notification issued by the Ministry of Agriculture and Irrigation and, therefore, is clearly a liability which is allowable. Reliance has been placed on the decision of the Supreme Court in the case of Kedarnath Jute Mfg. Co. Ltd. [1971] 82 ITR 363. The contention on behalf of the Revenue is that earlier the Tribunal rightly held that the question of allowing deduction shall be subject to th....

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.... was questioning the correctness of that decision and was insisting that the assessee was liable to pay the excise duty. . . . The company is following the mercantile system of accounting and it can legitimately claim deduction in respect of a business liability even if such liability has not been quantified or paid. In Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363, the Supreme Court he....