https://www.taxtmi.com/caselaws?id=256291 Under the mercantile system, interest is taxable only when the assessee has a real and enforceable right to receive it; if recovery is uncertain and the loan accounts are under dispute or litigation, the interest does not constitute accrued income merely because it is booked on accrual basis. Section 34 of the Code of Civil Procedure, 1908 may be used only as an aid in understanding interest payable where the right to receive depends on judicial determination, and this does not alter the scope of Section 5 of the Income-tax Act, 1961. The disputed interest was therefore treated as not taxable in the relevant years. en-us Mon, 01 Dec 2014 00:00:00 +0530 Mon, 09 Feb 2015 00:14:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=256291 Under the mercantile system, interest is taxable only when the assessee has a real and enforceable right to receive it; if recovery is uncertain and the loan accounts are under dispute or litigation, the interest does not constitute accrued income merely because it is booked on accrual basis. Section 34 of the Code of Civil Procedure, 1908 may be used only as an aid in understanding interest payable where the right to receive depends on judicial determination, and this does not alter the scope of Section 5 of the Income-tax Act, 1961. The disputed interest was therefore treated as not taxable in the relevant years. Case-Laws Income Tax Mon, 01 Dec 2014 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=256291