1984 (7) TMI 46

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....referred by the Income-tax Appellate Tribunal, ' B ' Bench, Patna, and the following question of law has been referred for the opinion of this court: " Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the amount representing the contingency reserve does not form part of the commercial profit or real income of the assessee and is not includible....

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....t year 1965-66, the assessee created the contingency reserve of Rs. 8,727. In the assessment year 1966-67, it created such a reserve to the tune of Rs. 9,327 and in the year 1967-68 to the extent of Rs. 9,929. The ITO disallowed these contingency reserves for the assessment years in question. On appeal by the assessee, the AAC deleted the additions made by the ITO with regard to the amounts of ....

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....at case, relying upon the decision of the Kerala High Court in the case of Cochin State Power & Light Corporation Ltd. v. CIT [1974] 93 ITR 582 and the Bombay High court in the case of Amalgamated Electricity Co. Ltd. v. CIT [1974] 97 ITR 334, this court answered the question in favour of the assessee, although the Madras High Court had taken a divergent view in the case of Vellore Electric Corpor....