Interim court-protected receipts are not accrued income when retention remains contingent and subject to restitution.

Amounts received under interim court protection do not accrue as taxable income where the recipient has no unconditional, enforceable right to retain them and may be required to restore them by restitution if the underlying dispute is decided against it. Because the sum was held only as a contingent receipt and was shown as a current liability, it lacked the character of income in the relevant previous year. The addition was therefore unsustainable, and deletion of the assessment adjustment was correct.

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Issues: (i) Whether the amount received by the assessee pursuant to interim orders of the High Court had accrued as taxable income in the relevant previous year.

Analysis: The amount was received only against interim directions during pendency of the dispute and was shown as a current liability. The assessee had no vested or absolute right to retain the amount, since it could be required to return it by way of restitution if the underlying appeal succeeded. On these facts, the case was governed by the principle that income accrues only when the right to receive it becomes unconditional and enforceable in praesenti.

Conclusion: The amount did not accrue as income and was not taxable in the relevant year; the deletion of the addition was correct.

Final Conclusion: The appeal failed because the disputed sum was held to be a contingent receipt without accrued income character, so the assessment addition could not be sustained.

Ratio Decidendi: A receipt obtained under interim court protection, which remains subject to restitution and lacks an unconditional enforceable right to retain it, does not amount to accrued income for tax purposes.

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