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2012 (10) TMI 338 - MADRAS HIGH COURTIncome received in advance is an Asset or not – Assessee is running a tutorial institute. As regards the fee received from students, it is stated that the assessee charged the full fee for the entire course of study which ran to different years. Question is whether Fee receipts are to be treated as Income or Asset. Held that:- Method of maintaining the account on cash or mercantile system has no bearing on the issue. In this case the assessee had maintained the account only on cash system has no bearing on the issue. The asset as on the valuation date would have to be taken into consideration in the matter of assessment under Wealth Tax Act. Thus when the fee for the course was collected from students each as on the registration date, Contention of assessee that he had held the sums in trust which were actually due for the future is not tenable. Fees received has to be treated as Asset and not Income. As decided by Court in case of of [Vysyaraju Badreenarayana Moorthy Raju 1985 (3) TMI 2 - SUPREME COURT ] Receipts are to be treated as Asset as on the valuation date and are not be treated as Income – Appeal is allowed in favour of Revenue.
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