TMI Blog1997 (9) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome-tax Act, 1961, filed by the Revenue seeking a mandamus to the Tribunal for drawing up a statement of case and referring the following two questions for the opinion of the High Court : "(1) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in allowing interest of Rs. 40,67,364 due from Bombay Tyre International Ltd., in spite of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting. However, the debit notes raised by the assessee-company were not honoured by the debtor. In the subsequent year, the amount was written off. The Assessing Officer and the Commissioner of Income-tax (Appeals) both held that so far as the assessment year in which the debit entry was made is concerned, the amount of interest will be treated as an income accrued and then it could be treated as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he substance of the matter is the income. If income does not result at all, there cannot be a tax, even though in book-keeping, an entry is made about a "hypothetical income", which does not materialise. Where income has, in fact, been received and is subsequently given up in such circumstances that it remains the income of the recipient, even though given up, the tax may be payable. Where, howeve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t agreement had altered the rate of commission in such a way as to make the income which really accrued to the assessee different from what had been entered in the books of account. In the case at hand, the Tribunal has on an evaluation of relevant circumstances held that the mere unilateral act of the assessee debiting the books of account with the amount of interest, the liability for payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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