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25. Before reference is made to the cases cited it is necessary to make a preliminary observation. According to the principles of mercantile accountancy the profits of the mills are ascertained by comparing on the one side the amount representing the total of, (a) the value of the goods or stock on hand at the beginning of an accounting period, (b) the cost of purchases, and (c) the expences of conducting the business or undertaking during the accounting period with the amount representing (i) the value of the stock on hand at the end of the period and (2) the amount realised by eale- of the goods on the other Bide. According to tbia system of accounting an item becomes a trade receipt on the day when it is receivable even though the date of receipt is postponed. Similarly, an item becomes an admissible outgoing of the business on the day on which it becomes a debt due from the business irrespective of the date of ita actual payment. If, for instance, goods are sold by the mills today, the sale price is brought into today's account and will form part of the total sales in the profit and loss account of the mills even though the price may be payable next month. Similarly, if goods have been bought by and for the mills, the purchase price has to be entered in the account the moment the property in the goods has passed to the mills, though payment niay not be made till afterwards and this item will go to form part of the total purchases. Debts remaining due at the end of the period of account should be brought in at their full value unless they are found to be bad or doubtful, This is the general rule though an exception has been recognised in the case of payments spread over a long period of years under a contract about which there has been some difference of opinion between the learned Lords who decided the case of Absalom v. Talbot, (1944) A C. 204 : (113 L. J. K. B. 869). It is further necessary to state that a deduction in respect of future loss anticipated but unascertained by the end of the accounting ptriod is cot allowable for income-tax purposes though it may be a prudent business precaution in the case of a merchant who wishes to ascertain how much of the profits he can spend away on his own purposes. In certain circumstances, sums received in respect of sales can properly be placed to a suspense account in order to meet possible losses on other sales in which event it becomes necessary to identify tbe time when the receipts are to be brought into account : Commissioner of Taxes v. Melbourne Trusts Ltd., 1914 A. C. 1001 : (A. I. R. (1) 1914 P. C 230). Lastly it has to be stated that it is the inconre of the "previous year" that is charged under the Aot, For the purposes of computing profits, each year is a self-contained period of time and the profits of that year alone should be computed for purposes of income-tax, Losses sustained in previous years cannot be deducied in computing the profits of the account year in the absence of a special provision allowing the carrying forward of such losses, Commr. of Income tax, United Provinces of Agra & Oudh v. Basantrai Takhat Singh, 55 ALL. 452: (A.I.R. (20) 1938 P. C. 180) and Commr. of Income-tax, C. P. & Berar v. S. M. Chitnavis-63 M. L. J. 861 : (A. I. R. (19) 1932 P. C. 178). No deduction is permissible for tax purposes in respect of a future loss which is unascertained by the end of the accounting period, however prudent it may be for the trader to make provision for such a loss: Whimster & Co. v. Inland Revenue Commissioners, (1926) 12 T. C. 813, Edward's Collins & Sons Ltd. v. Inland Revenue Commissioners, (1924) 12 T. C. 778. The Income-tax authority is entitled to ascertain and assess to tax the profits and gains of the previous year of a trader or a merchant even though he had not cared to cast his accounts and find out whether he had made a profit or loss. The rights of the revenue authority cannot be made to depend on the way the tax-payer's accounts have been prepared nor are they concluded by the character of the book-keeping relating to the business : Edinburgh Life Assurance Co. Ltd, v. Lord Advocate, (1910) A. C 143 at p. 168 : (79 L. J. P. C. 41). Glenboig Union Fireclay Co, Ltd. v. Inland Revenue Commissioners, (1922) 12 T. C. 427 at pp. 447, 461.