Madras High Court
Dated: 01.08.2011
Tax Case (Appeal) No. 534 of 2004
Commissioner of Income Tax, Madurai Vs. K. A. S. Mathivanan
APPEAL under Section 260A of the Income Tax Act against the order dated 9.9.2003 made in ITA No.1297/Mds/96 on the file of the Income Tax Appellate Tribunal, Madras ‘B’ Bench, for the assessment year 1991- 92.
J U D G M E N T
(Judgement of the Court was delivered by M.JAICHANDREN,J.)
This Tax Case (Appeal) has been filed by the Revenue as against the order of the Income Tax Appellate Tribunal dated 9.9.2003 n respect of the assessment year 1991-92. The substantial questions of law arising for the consideration of this Court are as follows:
“1. Whether in the facts and circumstances of the case, the Tribunal was right in holding that the balance remaining in the “suspense fund” should also be allowed as an expenditure, when the amounts were only expended in the future years?
2. Whether in the facts and circumstances of the case, the Tribunal was right in holding that the outstanding balance does not represent a contingent liability?”
2. The assessee, who has been engaged in the business of printing and selling lottery tickets had filed the return of income for the assessment year 1991-92, showing a loss of Rs.1,28,506/-. The return was processed, under Section 143(1)(a) of the Income Tax Act, 1961, and and intimation had been issued. The case was selected for scrutiny and a hearing notice, under Section 143(2) of the Act, was also issued. Based on the details given by the assessee and on a perusal of the accounts, it was noticed by the Assessing Officer that the assessee was maintaining suspense account crediting a sum of Rs.23,77,458/- in the trial balance for the year ended on 31.3.1991. The assesse had furnished the details as under:
