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2008 (9) TMI 357 - DELHI HIGH COURTMercantile system of accounting - payment made to expatriates in the sum of Rs 4,03,31,726/- - The case of the revenue is that since the approval for remittances had been received in the subsequent year, there could not have been an accrued liability in the current year - provision made for bad/doubtful debts – section 115JA – held that - , there was no legal bar to the assessee entering into the agreement with EDS Global Services Inc., USA. The only question was of seeking approval for remittances of the amounts outside India for which approval of the Reserve Bank of India was required. The fact that the liability had accrued as per the contract cannot be disputed. Once that is the case, then, where the assessee follows the mercantile system of accounting, it cannot be said that the liability had not accrued in terms of the contract.
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