COMMISSIONER OF INCOME TAX Vs. MATHULAL BALDEO PRASAD

JUDGEMENT

(1.) THIS is a reference under section 66(1) of the Indian Income-tax Act, 1922, read with section 21 of the Excess Profits Tax Act, 1940, made by the Income-tax Appellate Tribunal at the instance of the assessee Messrs. Mathulal Baldeo Prasad, Kanpur.

(2.) THE facts stated by the Appellate Tribunal in the statement of the case drawn up and referred to this court are as follows :

(3.) THE question is whether this loss of Rs. 14,993 odd was an ascertained liability in and a loss pertaining to the assessment year 1945-46 or to the assessment year 1946-47. THE system of accounting being mercantile, the answer to this question would depend upon whether an enforceable liability had arisen in the assessment year 1945-46 or whether it could be said that the liability had arisen in the year 1946-47.