Does ICDS-IV apply to interest received by an assessee on compensation or on enhanced compensation.

Manual - ICDS IV : Revenue Recognition

Section 145A(b) of the Act provides that interest received by an assessee on compensation or on enhanced compensation, as the case may be, shall be deemed to be the income of the year in which it is received. Such interest shall be taxed under the head 'Income from other sources' in the year of receipt, irrespective of whether assessee follows mercantile system of accounting or cash system. Thus ICDS-IV will not apply to interest received by an assessee on compensation or on enhanced  compensation, since, in case of conflict between ICDS and the Act, the Act shall prevail.

Dated: 28-8-2017