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2017 (12) TMI 42 - AT - Income TaxAccrual of income / real income - Non payment of lease rental by lessee to assessee - lessee asked the assessee to adjust the excess lease rentals paid by it till March, 2008 towards the other months - dispute - Held that:- Where there is a dispute, the income would accrue and would not crystallise till the dispute is settled and therefore, the same cannot be brought to tax even under the mercantile system of accounting. - Decided in favour of assessee Disallowance of interest paid by the assessee on late deposit of EPF and ESI payments - CIT-A held that these are compensatory in nature and therefore, allowable under section 37(1)- Held that:- The interest is paid by the assessee for late payment of PF and ESI to the Government account and therefore, is only compensatory in nature and attains the nature of the payment on which the interest is paid. In fact, the hon'ble Supreme Court in the case of Prakash Cotton Mills (P.) Ltd. (1993 (4) TMI 3 - SUPREME Court ) has clearly held that no disallowance under section 37(1) can be made without examining the scheme of provisions of the relevant statute. Therefore, we see no reason to interfere with the order of the Commissioner of Income-tax (Appeals) on this issue also.- Decided in favour of assessee
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