2014 (6) TMI 78

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..... R. Meena, A.M. 1. The Revenue's appeal is emanating from the order of CIT(A)-XX, Ahmedabad dated 31.01.2011 for A.Y. 2007-08. 2. The sole ground of Revenue appeal is against deleting the addition of Rs. 11,93,810/- made by the A.O on account of estimation of income from FDR, Visnagar Bank. The A.O observed that Assessee had FDR of Rs. 1,90,38,100/- in Visnagar Bank. But no interest income from t .....

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..... n' view of the above, the chances of recovery of the principal amount of the FDR made-by the appellant with Visnagar Nagrik Sahakari Bank Ltd., was doubtful. When the recovery of the principal amount itself was doubtful, then, the question of recovery of interest was almost impossible. In such a situation, the appellant was justified in not accounting the interest income on accrual basis in th .....

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..... banking license with effect from 11.07.2003. The Assessee in earlier year also had not disclosed interest income on these FDRs which has been accepted by the Revenue. When principal amount itself was doubtful whether it would recover or not than the question of recovery of interest was almost impossible. The appellant was right not to book interest income on the basis of accrual. In real term, th .....

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