COMMISSIONER OF INCOME TAX Vs. K R GANESH

JUDGEMENT

(1.) THE reference is at the instance of the Revenue. THE assessment year is 1981-82. THE question referred is :

(2.) THE assessee was a bus operator during that assessment year and was plying buses between Madras and Nellore. In that year, he was served with a demand notice for a sum of Rs. 2,28,907 as the amount of motor vehicle tax due to the Andhra Pradesh Government. THE assessee made a provision for the payment of the sum and claimed it as deduction, as the assessee was maintaining accounts on the mercantile basis. THE assessee had also filed a writ petition in the High Court and had obtained an interim order of stay against the collection of the demand. However, the petition had not been decided on the merits. THE claim of the assessee was rejected by the Income-tax Officer. THE assessee's appeal was allowed by the Commissioner whose order was sustained by the Tribunal. THE Tribunal relied on the decision of this court in the case of CIT v. East India Corporation Ltd. [1986] 159 ITR 712.