Case Law Analysis
|Income Tax Appellate Tribunal
Provision for Repair of Unserviceable Spares | Reasonable Estimation Permits Deduction Under Section 37: ITAT Delhi
The ITAT Delhi has ruled that airlines may claim tax deductions for provisions made toward repairing unserviceable aircraft spares, provided the estimate is reasonable and grounded in operational data. This overturns blanket disallowances and affirms that contingent liabilities in capital-intensive industries are not automatically non-deductible under Section 37, setting a critical precedent for aviation and manufacturing sectors.