https://www.taxtmi.com/caselaws?id=180841 Forfeited share money later credited against a debtor's liability retained its original character as capital to the extent applied to principal, and did not become trading profit merely because it was later appropriated in settlement. Only the portion attributable to interest was revenue in nature and taxable. On that basis, a sum that was truly capital could not be treated as a bad debt deduction, while the interest element remained assessable as income. The governing principle is that the character of a receipt is fixed by its source and nature at the time of receipt, and later appropriation cannot convert capital into revenue except where the amount is in fact applied to interest. en-us Wed, 12 Apr 1944 00:00:00 +0630 Sat, 02 Apr 2016 15:38:08 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=180841 Forfeited share money later credited against a debtor's liability retained its original character as capital to the extent applied to principal, and did not become trading profit merely because it was later appropriated in settlement. Only the portion attributable to interest was revenue in nature and taxable. On that basis, a sum that was truly capital could not be treated as a bad debt deduction, while the interest element remained assessable as income. The governing principle is that the character of a receipt is fixed by its source and nature at the time of receipt, and later appropriation cannot convert capital into revenue except where the amount is in fact applied to interest. Case-Laws Income Tax Wed, 12 Apr 1944 00:00:00 +0630 https://www.taxtmi.com/caselaws?id=180841