https://www.taxtmi.com/caselaws?id=7630 Client money held by a solicitor in a fiduciary capacity does not become trading income merely because unclaimed balances are later transferred to the profit and loss account. The character of the receipt is fixed at the time of receipt, so a later accounting entry cannot convert principal money into taxable revenue. The fact that the clients' recovery may be barred by limitation also does not extinguish the underlying liability or create income. Distinguishing the distillery security-deposit line of cases, the Court noted that those amounts had a profit-making quality from inception. The balances were therefore not revenue receipts and were not liable to tax. en-us Wed, 24 Apr 1968 00:00:00 +0530 Thu, 22 Feb 2024 12:03:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=7630 Client money held by a solicitor in a fiduciary capacity does not become trading income merely because unclaimed balances are later transferred to the profit and loss account. The character of the receipt is fixed at the time of receipt, so a later accounting entry cannot convert principal money into taxable revenue. The fact that the clients' recovery may be barred by limitation also does not extinguish the underlying liability or create income. Distinguishing the distillery security-deposit line of cases, the Court noted that those amounts had a profit-making quality from inception. The balances were therefore not revenue receipts and were not liable to tax. Case-Laws Income Tax Wed, 24 Apr 1968 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=7630