Supreme Court of India
Associated Power Co. Ltd. v. Commissioner of Income Tax
INSC stands for INDIAN SUPREME COURT. A neutral citation scheme assigned by the Court itself, so a judgment can be cited without depending on a commercial law reporter. INSC is the neutral citation scheme assigned by the Supreme Court, so a judgment can be cited without depending on a commercial law reporter.
1 Supreme Court bench has cited this judgment.
What the Court ordered
We hold that the amount credited to the Contingencies Reserve is not diverted by reason of an overriding obligation or title and, in determin ing the business profits of the assessee, it must be taken into account.
Judgment, page 16
From the headnote
Income Tax Act, 1961 : Contingency Reserve Account-Amount set apart to meet contingen cies-Assessee owner thereof-Not a business expenditure-Hence not allow able as a deduction in aniving at the taxable business income. Electricity (Supply) Act, 1948 : c Sixth Schedule-Clauses III, IV and V-Contingencies Reserve- Created from the revenue of each year of account-Invested i!l securities authorised under the Indian Trusts Act, 1882-Within a period of six months-Not to be drawn upon during cwTency of licence-Except to meet specified charges with the approval of State Govemment-To be handed
Authorities it was built on
Where later benches applied it
Of those, 1 referred to
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