TMI Blog1992 (1) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... he behest of the Commissioner of Income-tax, Nagpur, the following four questions have been referred to this court under section 256(1) of the Income-tax Act, 1961 (for short "the I.T. Act"). "1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee was not liable to be assessed in respect of the interest income on accrual basis ? 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f which she sold two annas share to six different persons who were close relatives. The entire consideration was not received immediately and the unpaid price carried interest as per agreement. The assessee showed a sum of Rs. 2,734 as interest received for the assessment year 1973-74. The Income-tax Officer taxed the interest on accrual basis for the years 1974-75, 1975-76 and 1976-77. The assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compensation under the head "Income from house property". It was not allowed by the Income-tax Officer. For the assessment year 1973-74, the assessee claimed deduction of the amount of repair cess. It was not allowed by the Income-tax Officer. The assessee earned income also from other sources. She did not maintain regular account books and did not follow the mercantile system of accounting. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In our view, for the same reasons the interest income also could not be taxed on accrual basis since it also falls under the head "Other sources". The share of compensation paid to the trust for retention of part of consideration even before the registration of the sale deed was not deductible out of the income from house property as the liability was personal and did not create any superior t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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