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TMI Blog2014 (10) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... the assesee maintain mercantile system of accounting – Held that:- Following the decision in Commissioner of Income-tax, Central Circle, Bangalore Versus Canfin Homes Ltd. [2011 (8) TMI 178 - KARNATAKA HIGH COURT] - if an assessee adopts mercantile system of accounting and in his account he shows a particular income as accruing, whether that amount is really accrued or not is liable to bring the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n J. Neeralgi, Advocate. For The Respondent : Sriyuths. A. Shankar and M. Lava, Advocates JUDGMENT The revenue has preferred this appeal challenging the order passed by the order passed by the Tribunal holding that the assesse need not pay tax in respect of non-performing assets though the assesse is adopting mercantile system of accounting. 2. The substantial question of law whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause the said amount accrued was not realized immediately cannot be a ground to avoid payment of tax. But, if in his account it is clearly stated though a particular income is due to him but it is not possible to recover the same, then it cannot said to have been accrued and the said amount cannot be brought to tax. In the Instant case we are concerned with a non-performing asset. As the definitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mercantile system of accounting, he as to pay tax on the revenue which has accrued notionally is without any basis. In that view of the matter, the second substantial question framed is answered against, the revenue and in favour of the assessee. 4. In that view of the matter, we do not see any merit in this appeal. The said question of law is answered in favour of the assesse and against the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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