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2018 (5) TMI 264 - DELHI HIGH COURTTaxability on notional interest - Accrual of income - AO added interest as the assessee’s income holding that it had “accrued” to it even if it was actually unpaid as the assessee followed the mercantile system of accounting - Held that:- in the absence of any findings that the cross holdings of the debtor companies was the predominant or sole reasoning for the assessee’s inability to recover its dues, is bound by the reasoning in Vishisht Chay Vyapar (2010 (11) TMI 88 - Delhi High Court ); more so, given that the Supreme Court has given its imprimatur on that ruling. The division bench had ruled that RBI’s prudential banking norms, embodied in its directions to banking and non banking entities, were as binding as accounting standards under Section 145 of the Income Tax Act, and reflection of income on notional basis, did not reflect the realistic assessment of real income - Decided in favour of assessee
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