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E. D. Sassoon And Company Ltd vs The Commissioner Of Income-Tax,Bombay ... on 14 May, 1954

4. Now, in connection with this amount, the case of the Revenue is that the assessee-company maintained its accounts in accordance with the mercantile system. In accordance with that system, it was obligatory on the assessee-company to make credit entries in its books of account for interest due at the rate of 2.1/2% in respect of its debenture-holdings on June 30 and December 31, 1950. This was obligatory, because, under the above system, accounts are not maintained on cash and/or receipt basis. Accounts maintained must show credits in respect of whatever accounts become payable to an assessee, though not received in fact. In that connection, reliance is placed on the provisions of s. 13 of the Act. Reliance is also placed on the observations of the Supreme Court as regards the true construction and effect of the word "arising" as contained in s. 4A(c) and other sections of the Act in the case of CIT v. Ahmedbhai Umarbhai & Co. , Anglo-French Textile Co. v. CIT and E. D. Sassoon & Co. Ltd. v. CIT . The submission was that the observations of the Supreme Court in these cases go to show that the word "arising" has been used in diverse sections of the Act in contradistinction to the phrase "received". The submission was that particularly in the matter of the assessees who maintained books of account on the mercantile system, receipt or collection of debts was not the relevant date for considering the arisal of income of these assessees. In respect of the assessees maintaining accounts in accordance with the mercantile system the true date of arisal of income was the date when the debt in respect of the income became due and/or the due date for payment in respect of such income. The submission was that interest on the debenture-holdings under the terms of the debentures themselves must be held to have become due for the accounting year 1950 on June 30 and December 31 of that year. As the sum of pound 12,152-10-10 (Rs. 1,62,033) was interest relating to the accounting year 1950, the assessee's case that the income of this interest had not arisen in that year should be negatived. A finding accordingly should be made that the above income had arisen in 1950 and the gross income from taxable territories without India in 1951 was accordingly Rs. 3,11,000 odd only.
Supreme Court of India Cites 31 - Cited by 1764 - N H Bhagwati - Full Document

Commissioner Of Income-Tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay on 4 May, 1950

4. Now, in connection with this amount, the case of the Revenue is that the assessee-company maintained its accounts in accordance with the mercantile system. In accordance with that system, it was obligatory on the assessee-company to make credit entries in its books of account for interest due at the rate of 2.1/2% in respect of its debenture-holdings on June 30 and December 31, 1950. This was obligatory, because, under the above system, accounts are not maintained on cash and/or receipt basis. Accounts maintained must show credits in respect of whatever accounts become payable to an assessee, though not received in fact. In that connection, reliance is placed on the provisions of s. 13 of the Act. Reliance is also placed on the observations of the Supreme Court as regards the true construction and effect of the word "arising" as contained in s. 4A(c) and other sections of the Act in the case of CIT v. Ahmedbhai Umarbhai & Co. , Anglo-French Textile Co. v. CIT and E. D. Sassoon & Co. Ltd. v. CIT . The submission was that the observations of the Supreme Court in these cases go to show that the word "arising" has been used in diverse sections of the Act in contradistinction to the phrase "received". The submission was that particularly in the matter of the assessees who maintained books of account on the mercantile system, receipt or collection of debts was not the relevant date for considering the arisal of income of these assessees. In respect of the assessees maintaining accounts in accordance with the mercantile system the true date of arisal of income was the date when the debt in respect of the income became due and/or the due date for payment in respect of such income. The submission was that interest on the debenture-holdings under the terms of the debentures themselves must be held to have become due for the accounting year 1950 on June 30 and December 31 of that year. As the sum of pound 12,152-10-10 (Rs. 1,62,033) was interest relating to the accounting year 1950, the assessee's case that the income of this interest had not arisen in that year should be negatived. A finding accordingly should be made that the above income had arisen in 1950 and the gross income from taxable territories without India in 1951 was accordingly Rs. 3,11,000 odd only.
Supreme Court of India Cites 42 - Cited by 253 - H J Kania - Full Document

The Anglo-French Textile Company Ltd. vs Commissioner Of Income-Tax, Madras on 8 December, 1953

4. Now, in connection with this amount, the case of the Revenue is that the assessee-company maintained its accounts in accordance with the mercantile system. In accordance with that system, it was obligatory on the assessee-company to make credit entries in its books of account for interest due at the rate of 2.1/2% in respect of its debenture-holdings on June 30 and December 31, 1950. This was obligatory, because, under the above system, accounts are not maintained on cash and/or receipt basis. Accounts maintained must show credits in respect of whatever accounts become payable to an assessee, though not received in fact. In that connection, reliance is placed on the provisions of s. 13 of the Act. Reliance is also placed on the observations of the Supreme Court as regards the true construction and effect of the word "arising" as contained in s. 4A(c) and other sections of the Act in the case of CIT v. Ahmedbhai Umarbhai & Co. , Anglo-French Textile Co. v. CIT and E. D. Sassoon & Co. Ltd. v. CIT . The submission was that the observations of the Supreme Court in these cases go to show that the word "arising" has been used in diverse sections of the Act in contradistinction to the phrase "received". The submission was that particularly in the matter of the assessees who maintained books of account on the mercantile system, receipt or collection of debts was not the relevant date for considering the arisal of income of these assessees. In respect of the assessees maintaining accounts in accordance with the mercantile system the true date of arisal of income was the date when the debt in respect of the income became due and/or the due date for payment in respect of such income. The submission was that interest on the debenture-holdings under the terms of the debentures themselves must be held to have become due for the accounting year 1950 on June 30 and December 31 of that year. As the sum of pound 12,152-10-10 (Rs. 1,62,033) was interest relating to the accounting year 1950, the assessee's case that the income of this interest had not arisen in that year should be negatived. A finding accordingly should be made that the above income had arisen in 1950 and the gross income from taxable territories without India in 1951 was accordingly Rs. 3,11,000 odd only.
Supreme Court of India Cites 26 - Cited by 132 - Full Document
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