allowing the liability. In the opinion of the Tribunal the question,
however, was as to whether such a liability was only a contingent liability ... contingent contract and a completed
ITA No1774 of 2010 Page 10 of 12
contract in order to appreciate distinction between a
contingent liability
latter. The distinction between a legal liability which is deductible and a liability which is future or contingent and for which no deduction ... between an actual, i.e., legal, liability, which is deductible, and a liability which is future or contingent and for which no deduction
Idea Cellular Ltd, Mumbai vs Dcit 3(2), Mumbai on 12 October, 2022
IN THE
said to be a
contingent liability but the real liability and same is allowable as deduction even
though the liability may have to be quantified ... precisely
possible at the time of incurring the liability would not make an
ascertained liability a contingent.
9.3.4 Almost to the similar effect, there
Contingent Liabilities and
Contingent " issued by the Institute of Chartered Accountants
of India and notified under the Income Tax Act, 1956 ,
"Contingent liability ... bank guarantee - contingent liability
assuming the character of ascertained liability as per assessee
With regards to the aforesaid the liability on account of claim
raised
payable upon a contingency does not become a debt until the said contingency has happened. A liability to pay income-tax is a present liability ... made between an actual liability in praesenti and a liability de futuro, which for the time being is only contingent. The former is deductible
during which the provision was made for the liability and that the liability was not a contingent liability. In so holding, the Supreme Court extracted ... reduction or even extinction of the liability, would not have the effect of converting that liability into a contingent liability; (iv) A trader computing
contingent liability?
40. To begin with, it is necessary to examine the basic concepts of 'accrued
liability' and 'contingent liability'. This ... reduction or even extinction of the liability, would not
have the effect of converting that liability into a contingent
liability;
(iv) A trader computing
extent of the liability would vary in any particular year. The liability towards a particular employee may be contingent, but the cumulative or collective ... liability of the company towards the employees in general is a liability which is certain and the extent of the liability will depend upon contingencies
past experience
and the liability is an liability in praesenti which is an
accrued/crystallized liability and not an contingent liability ... provision is not a contingent or future
liability, The liability is in praesenti and certain liability,
accrued during the Assessment Year 1999-2000, on
expiry
