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TMI Blog2015 (7) TMI 785X X X X Extracts X X X X X X X X Extracts X X X X ..... ct that the categorisation of a receipt can take place only at the time of appropriation i.e. in case of fees only when the matter is over or as when the Assessee decides on the quantum of fees. This will not be the entire advance received as at the time it is received it does not bear any particular characterisation for the purposes of treating it as income - Decided against revenue. Disallowance under Section 14A - ITAT deleted addition as AO had not recorded any finding that any expenditure incurred by the Assessee was attributable for earning the exempt income - Held that:- In order to disallow the expenditure there must be a nexus between the expenditure incurred and the income not forming part of the total income. Consequently, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complicated or settled, are transferred to the Profit Loss Account. Where the cases are pending, the credit balances are carried forward to the next year as sundry creditors. 5. For the year under consideration, the Assessing Officer ( AO ) made an addition of ₹ 10,78,01,478 representing balances outstanding on 31st October 2011 out of the total credit balance of ₹ 20,79,97,695 as on 31st March 2009. The AO held that since the Assessee adopted the cash system of accounting, the taxing of the income could not be deferred to the subsequent years. Income had to be taxed in the year in which it was received. Since the above amount had not been returned or shown as professional fee, it had to be taxed during the current AY. Fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x proceedings the principle of consistency requires that unless facts or law have/has undergone a change, the view taken earlier under similar circumstances needs must be followed. 8. Learned counsel for the Department has not questioned the above exposition of the law. The only ground urged before the Court is that the monies were kept invested by the Assessee in the mutual funds in the name of the Assessee and, therefore, had to be treated as income in his hands. However, as noted by the ITAT these facts were not new to the AY in question. The issue was whether the Assessee was consistently following a certain system of accounting which had been accepted by the Department. There is no change of system of accounting followed by the As ..... X X X X Extracts X X X X X X X X Extracts X X X X
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