WOODWARD GOVERNOR INDIA LTD. Vs. COMMISSIONER OF INCOME TAX

The aforesaid decision in Woodward Governor India Limited (supra), which pertains to Assessment Year 2004-05, accepts the legal position that provision for warranty can be allowed as an expenditure under Section 37(1) of the Income Tax Act, 1961 (Act, for short). The other question, i.e., how much or the quantum of expenditure, which should be allowed, it has been held, depends upon facts and circumstances of each case. The working of the figure or quantum of the provision for warranty has to be rational and scientific. For more information