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TMI Blog2015 (5) TMI 791X X X X Extracts X X X X X X X X Extracts X X X X ..... P P Kanwer, Advs. For The Respondent : Mr. N P Sahni, sr. standing counsel with Mr. Nitin Gulati, Adv. JUDGMENT : MR. JUSTICE S. RAVINDRA BHAT (OPEN COURT) 1. The following questions of law arise for consideration : "(i) Whether the Tribunal misdirected itself in law in holding that the interest of Rs.70,26,492/- had accrued to the assessee and hence was assessable to tax in the hands of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is acknowledgment of debt by the said supplier (TIPCO), who also undertook to pay, besides pre-amounts, interest in agreed rate. However, TIPCO Ltd. breached its commitments under the said agreement. In these circumstances for AY 1997-98, the assessee reversed its entries of outstanding amounts. After initially suffering adverse order, the CIT(Appeals) on being approached accepted the assessee's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel relied upon the judgments of the Supreme Court in CIT V. Shoorji Vallabhdas & Co. (1962) 46 ITR 144 and Godhra Electricity Co. Ltd. V. CIT (1997) 225 ITR 746. It is emphasised that though the income tax enactment takes into account two points of time at which taxation liability is directed, i.e. accrual of income or its receipts, nevertheless the substance of the matter is income and if inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellants and submitted that the subsequent development could not have been validly re-urged as ground for relief in the present case. It was emphasised that since in the books the assessee never reversed the entry during the relevant points in time, learned counsel highlighted that logically the revenue was justified in brining to tax such amounts on the basis that they had accrued. 4. The judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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