Citation:
In the case of Knowledge Infrastructure Systems (P) Ltd. vs. DCIT before ITAT, Delhi.

Assessment Year: 2020-21
Date of Order: 1.8.2023

Issue:
Addition of Contingent Liability by way of adjustment u/s 143(1)(a).

Facts:
Assessee furnished particulars of Contingent Liabilities in paragraph 21(g) which were neither debited to the profit and loss account nor corresponding expense was considered for computation of total income.

Held:
ITAT allowed appeal and directed the AO to verify the claim and allow as contingent liability  not forming part of profit and loss account and total income can't not be added to total income, as it was not claimed as expense.

Link to download court case 
https://cavinaymittal.com/Image/Knowledge-Infrastructure-Systems-Pvt-Ltd-Vs-DCIT-ITAT-Delhi-%20(1)%20(1).pdf

Regards.
🙏Rajiv
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