Can a assessee can follow different methods of accounting for different sources of income under the same head of income, or different heads of income.

Manual - Introduction

Where an assessee is following different methods of accounting then, ICDS would apply only to those sources of income, where mercantile system of accounting is followed and would not apply to those sources of income, where cash system of accounting is followed. This system is followed with the sole aim of checking the escapement of income, which occurred due to heterogeneous system of accounting followed by the assessee.

For example, if the assessee is following mercantile system of accounting for his manufacturing business and cash system of accounting for his commission agency business, then ICDS would then apply only to the manufacturing business, and not to the commission agency business.

Dated: 11-8-2017