Court Rules Against Estimating Future Earnings for Tax; Only Real Income Taxable Under Income Tax Act.

Accrual of income - method of accounting to recognize the revenue - Addition made for excess interest spread ('EIS') income earned on assignment of receivables - AO has arrived at estimated income under such arrangement by applying the present value factor on future estimated earnings, the receipt of which was uncertain. We concur with the submissions of Ld. AR that such a methodology has not been recognized under Income Tax Act and only the real income has to be assessed to tax. - AT .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X