S.43B(f): provision for future leave encashment allowable in year of payment

M/s. Rashtriya Ispat Nigam Ltd. Vs. JCIT (OSD) (ITAT Visakhapatnam)

The assessee company has created a provision under the head ’Future Leave Encashment’. During the course of assessment proceedings, the assessee company was asked to explain how the amount debited towards the provision for future leave encashment can be allowed as deduction. In response to which, the assessee company filed its explanation contending inter alia, that the assessee company is following mercantile system of accounting and the amount on account of le

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