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2016 (3) TMI 147 - HC - Income TaxRevision u/s 263 - Accrual of liability - whether contingent - interest liability debited in profit and loss account and accordingly allowed the same on the principle of mercantile accounting by AO - Held that:- At any rate the assesse’s liability to pay interest computed at simple rate was crystallized on 26.7.2001, and at no later point of time. Merely because the asseessee was negotiating with the ONGC alongwith other members of the association for softer terms and for charging simple interest instead of compound interest would not mean that this liability was in any manner contingent. The assessee when debited such amount in the profit and loss account towards interest liability, the same was therefore rightly granted by the assessing officer. The Commissioner therefore committed legal error in disturbing such order of assessing officer. - Decided in favour of assessee
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