Provision for a liability allowable if it can be estimated & if there is reasonable certainty

The provision for a liability is amenable to a deduction if there is a reasonable element of certainty that it shall be incurred and can be estimated: Delhi HC RELEVANT PARAGRAPH 5. Having heard the learned counsel for the Revenue as well as the assessee, we are of the view that no fault can be found with the reasoning of both the CIT(A) as well as the Tribunal. In our view, the issue raised by the Revenue before us that the liability under the “long service award” scheme of the assessee is contingent as the payment under the same scheme is dependent on the discretion of the manage...