Bombay H.C : Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in the computation of the capital for the purpose of the Companies (Profits) Surtax Act, 1964, only such part of the amount credited by the assessee in its accounts as provision for taxation that was actually found necessary to be utilised for the purpose has to be excluded and not the full amount of such credit ?

High Court Of Bombay

CIT vs. Pfizer Ltd.

Section SURTAX SCH. II, SURTAX RULE 1

S. P. Bharucha & T. D. Sugla, JJ.

IT Ref. No. 90 of 1976

18th November, 1988

Counsel Appeared

G. S. Jetley, Mrs. M. Singh & K. C. Sidhwa, for the Revenue : N. A. Dalvi instructed by M/s Crawford Bailey & Co., for the Assessee

S. P. BHARUCHA, J.:

The only question to be decided in this reference reads thus :

“Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in the computation of the capital for the purpose of the Companies (Profits) Surtax Act, 1964, only such part of the amount credited by the assessee in its accounts as provision for taxation that was actually found necessary to be utilised for the purpose has to be excluded and not the full amount of such credit ?”

Counsel are agreed that the question must be answered in the affirmative and in favour of the assessee having regard to the judgment of the Supreme Court in Vazir Sultan Tobacco Co. Ltd. vs. CIT (1981) 132 ITR 559 (SC).

The question is so answered. No order as to costs.

[Citation : 177 ITR 140]

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