Admissibility of Business Expenditure ::

Last updated: 07 September 2007

Court :
HC

Brief :
Held by hon"ble court that under mercantile system of accounting assessee is entitled to deduction of loss/ expenditure in the year in which such entry is made in books of account. Hence, A.O. is not justified in disallowing deduction for amount payable under terms of contract on ground that such sum was not paid actually.

Citation :
Jiwanram Sheoduttrai Vs. C.I.T

Admissibility of Business Expenditure Jiwanram Sheoduttrai Vs. C.I.T 8/2/2005 (2005) 279 ITR 512 (Cal) Case Fact: Whether A.O. was justified in disallowing deduction for amount payable under terms of contract on grounds that such sum has not been paid actually. Decision: Held by hon"ble court that under mercantile system of accounting assessee is entitled to deduction of loss/ expenditure in the year in which such entry is made in books of account. Hence, A.O. is not justified in disallowing deduction for amount payable under terms of contract on ground that such sum was not paid actually.