Log In

| Recover password


The Madras High Court in 308ITR154 held that amount collected as contingency deposits for payment of possible tax liability would be a trading receipt no matter it is treated as a deposit in a suspense account. The Court however made a point that if and when the amounts collected would be refunded to the persons from whom the collection had been made, the assessee could claim a deduction in the year in which such a refund is made. The Kerala High Court in 295ITR473 also held that the mere fact that the assessee had created a head “Contingency deposit” and kept the collection as such without paying the amount to the Sales Tax Department would not change the character of the receipt

Leave a Reply

Your email address will not be published.

error: Do not copy the content of this website.