Deduction Denied for Unexplained Provision of Freight Expenditure & Labour Charges in Closing Stock

TCP Limited Vs ACIT (ITAT Chennai) Conclusion: Since assessee could not explain how the expenses which were claimed by assessee in the closing stock was allowable i.e., provision in regard to freight expenses payable and labour charges payable. Therefore, no deduction was allowable as assessee had not made any payment during the year and even there was no liability incurred for this, rather this was merely a provision. Held: AO while framing assessment and on perusal of audited balance sheet and profit & loss account of the assessee noticed that assessee had reported a sum of Rs.61.24 cror...