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2009 (5) TMI 507 - ALLAHABAD HIGH COURTIncome- accrual of income- The assesese was a non-banking financial company registered with the Reserve bank of India and derived income from hire purchase business and leasing of transport vehicle and machinery. The Assessing Officer added the deposits of Rs. 1,75,000 and Rs. 13,00,012 of security deposit under section 68 of the Act. The Assessing Officer also noticed the assessee had not charged lease rental and hire charges on non-performing assets. The Commissioner (Appeals) deleted both the additions. This was confirmed by Tribunal. Held that- (1) the assessee was obliged not to provide for hire charges and lease rental on non-performing assets in view of the RBI guidelines, according to which income relating to sub-standard assets/non performing assets which was outstanding for more than six months was not treated as income. (2) deposits for purchase of vehicle and was transferred to the hire purchase account, that the security deposit was given by cheque and that both these amounts were genuine, were based on appreciation of evidence and material on record.
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