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TMI Blog2011 (2) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... e balance of Rs.2,96,568/- (Rs.2,65,500/- on account of interest on securities and Rs.31,068/- from FDR interest) was declared by the assessee under the head 'income from other sources' as arising from securities. The Assessing Officer vide order dated 26.2.2001 while treating the amount of Rs.40,80,577/- as business income, assessed the income of the assessee at Rs.40,99,645/ - Held that: - the Apex Court in Commissioner of Income Tax v. Hindustan Housing and Land Development Trust Ltd. [1986 -TMI - 5944 - SUPREME Court] had held that where the lis is pending, the amount does not accrue or arise to the assessee - Decided in the favour of the assessee - ITA No. 446 of 2006 - - - Dated:- 22-2-2011 - MR. JUSTICE ADARSH KUMAR GOEL, MR. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,740/-. The assessee disclosed the payment of Rs.40,80,577/- towards interest received from the Executive Engineer. From the said payment, the tax was deducted at source at the rate of 23% i.e. Rs.9,24,630/-. Out of the aforesaid amount of Rs.40,80,577/-, a sum of Rs.38,15,007/- was declared to be in the nature of business receipts on which the assessee had applied the presumptive rate of 8% under Section 44AD of the Act, thereby declaring an income of Rs.3,05,206/- under the head 'business'. The balance of Rs.2,96,568/- (Rs.2,65,500/- on account of interest on securities and Rs.31,068/- from FDR interest) was declared by the assessee under the head 'income from other sources' as arising from securities. The Assessing Officer vide order dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Income-Tax v. Thirumalaiswamy Naidu and Sons, [1998] 230 ITR 534 (SC); II. Commissioner of Income-Tax v. United Provinces Electric Supply Company, [2000] 244 ITR 764 (SC); III. Commissioner of Income-Tax v. Polyflex (India) Pvt. Ltd., [2001] 251 ITR 527 (Kar); and IV. Commissioner of Income-Tax v. Smt. M. Sarojini Devi, [2001] 250 ITR 759 (AP). 8. It is not in dispute that the assessee is following mercantile system of accountancy. The mercantile system of accountancy envisages accrual or arising of income or deemed to accrue or arise during the year in question. 9. The apex Court in Hindustan Housing and Development Trust's case (supra) on which Tribunal has based its decision, was dealing with the case relating to a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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