1985 (1) TMI 51

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....as delivered by MULYE J.-The Income-tax Appellate Tribunal, Indore Bench, Indore, at the instance of the Revenue has made this reference under s. 256(1) of the I.T. Act, 1961, to this court to answer the following question of law : " Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in allowing the sum of Rs. 3,258 being sales tax for the assessment ....

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....ee is a private limited company engaged in the manufacture of aluminium conductors, winding wires, armatures, etc. On the scrutiny of the accounts for the assessment year 1977-78, the IAC (Assessment) noted that the assessee-company in the sales tax account had made the payment of Rs. 2,129 plus Rs. 3,258 as sales tax relating to the earlier years, i.e., for the assessment year 1971-72 and 1974-75....

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....xable liability under the I.T. Act. Thus, relying on the decision of the Supreme Court in Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363, the IAC (Assessment) held that the liability of sales tax relating to one year is to be charged for that particular year even if the tax is disputed in appeal. In the result, he added back the sum of Rs. 2,129 and Rs. 3,258 to the income of the assesse....

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....erence, none appeared on behalf of the assessee though SPC was issued. We have heard the learned counsel for the Revenue who submitted that the Tribunal has committed an error in holding that the liability for the sales tax arose during the accounting year relevant to the assessment year 1977-78 and was, therefore, deductible for 1977-78. He, therefore, submitted that the assessee has been main....