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2013 (7) TMI 421 - HC - Income TaxAccrued income - whether a sum which represented retention money for fulfillment of the contract by the assessee should be treated as accrued income – Held that:- The assessee had not to receive the sum and therefore it cannot be said that the amount had accrued to the assesse - unless and until a debt is created in favour of the assessee, which is due by somebody, it cannot be said that the assessee has acquired a right to receive the income or that the income has accrued to him - A debt must have come into existence and the assessee must have acquired a right to receive the payment - assessee did not get any right to receive the sum which could have been retained in pursuance of the contract - One has to look at the contract and not at the entries made in the books of account - by no stretch of imagination it can be said that the said amount had accrued by way of income to the assessee in the previous year in question. As decided in C.I.T. v. Simplex Concrete Piles (India) Pvt. Ltd., (1988 (12) TMI 52 - CALCUTTA High Court) (Cal.) it was held that case that when there is a clause with regard to retention money, the assessee gets no right to claim any part of the retention money till the verification of satisfactory execution of the contract is concluded and, therefore, if there is no immediate right to receive the retention money, the said amount cannot be said to have accrued to the assesse – appeal decided against revenue.
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