Income Tax Act, 1961

--Business expenditureAllowability Provision for warranty--Assessee made a provision towards warranty claim and out of that amount, had reversed the provision made for meeting warranty claims for earlier financial year. Assessing officer noticed that even after reversing the amount of provision for warranty, remaining amount left was claimed as deduction under section 37(1) without any actual claim or expenditure. Held: Following the decision in case of Rotork Controls India (P) Ltd. v. CIT 2009 TaxPub(DT) 1730 (SC) : (2009) 314 ITR 62 (SC), the matter was sent to assessing officer for re-determination of the quantum that could be allowed as a provision towards warranty claims and it was open to assessee to put forth its stand before assessing officer.

Income Tax Act, 1961 Section 37(1)

In the Karnataka High Court

D. V. Shylendra Kumar & B. Sreenivase Gowda, J.J.

CIT v. Denso Kirloskar

ITA No. 195 of 2009

19 February, 2013 

Appellant by : K.V. Aravind

Respondent by : A. Shankar and M. Lava