Case Law Details
Caprihans India Ltd. Vs DCIT (ITAT Mumbai)
Conclusion: Provision for leave encashment being in the nature of an ascertained liability was to be reduced while computing the book profit under Section 115JB.
Held: Assessee company had e-filed its return of income. While computing the “book profit” under Sec. 115JB, assessee company had added back the amount of the leave encashment provision. In the course of the assessment proceedings, AO inter alia observed that the provision for leave encashment was not to be allowed while computing the „book profit‟ under Sec.1 15JB. It was held the issue involved in the present appeal remained the same as was there in appeal of the assessee for A.Y. 2005-06 in ITA No. 4252/Mum/2011. It was concluded that the provision for leave encashment being in the nature of an ascertained liability was to be reduced while computing the “book profit” under Sec. 115JB. As the facts and the issue involved in context of the present issue remained the same as were there in the appeal of the assessee for A.Y. 2005-06 in ITA No. 4252/Mum/201 1, therefore, our order therein passed should apply mutatis mutandis for the disposal of the same.
FULL TEXT OF THE ITAT JUDGEMENT
The assessee and the revenue being aggrieved with the order passed by the CIT(A)- 41, Mumbai, dated 31.12.2009 for A.Y. 2005-06 have preferred cross-appeals before us. Also, the assessee is in appeal against the respective orders of the CIT(A)-41 for A.Y. 2006-07 and A.Y. 2007-08, both dated 31.12.2009. As certain common issues are involved in the captioned appeals, therefore, the same are being taken up and disposed off by way of a consolidated order. We shall first advert to the appeal of the assessee for A.Y. 2005-06. The assessee has assailed the impugned order on the following revised grounds of appeal before us:
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