1936 (3) TMI 1

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..... at year 1988, ending in November 1932, the asses-see's firm adopted what is known as the mercantile basis of accounting, that is to say, they showed the income accruing in any year as being the income on which assessment was to be based, and not the income received during that year. Shortly before the accounting period in question the assessee and his cousin quarreled. Litigation is going on for the partition of their estate and business, and the debtors of the firm refuse to pay interest, because they do not know which of the partners will ultimately be entitled to it. Consequently the actual amount received for interest is very much less than the amount shown in the books as accrued interest, and that being so, the assessee desires to cha .....

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..... sioner is satisfied that at a particular moment the assessee has changed his regular method of accounting, he is not likely to be satisfied in the following year or a few years later, that the regular method has been changed again back to the old method. The assessee is not entitled to change his method of accounting from year to year as suits him best ; the reference in Section 13 to the regular method of keeping accounts precludes any practice of that sort. But although I think that the reasoning of the learned Commissioner is in some respects wrong, because he certainly seems to suggest that a method once regularly adopted can never be changed, I think the question of law which the assessee desires us to direct the Commissioner to raise .....

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..... pplications must be rejected with costs on the original side scale to be taxed by the Taxing Master. Rangnekar, J.-I agree but as the question of construction of Section 13 has been raised in the course of the discussion, I should like to state shortly my view of the section. The section says that income, profits and gains shall be computed for the purposes of Secs. 10, 11 and 12 in accordance with the method of accounting regularly employed by the assessee. It follows from that section that when an assessee says that the method which he has followed has been regularly employed by him, the question whether that is so or not is entirely for the Income tax authorities, any opinion expressed by them would amount to nothing more than a finding .....

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