https://www.taxtmi.com/caselaws?id=10403 A compulsory transfer of a co-operative society's net profits to a reserve fund was treated as an appropriation of income after accrual, not a diversion at source by overriding title. The reserve fund remained the society's own asset, available for future business needs, contingencies, losses and debts, so the amount formed part of taxable income. The same transfer was also held not deductible under section 37 of the Income-tax Act because it was not business expenditure incurred wholly and exclusively for business, but a retention of profits for future use. The Revenue's assessment was therefore restored. en-us Wed, 21 Apr 2004 00:00:00 +0530 Wed, 15 Jul 2009 12:03:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=10403 A compulsory transfer of a co-operative society's net profits to a reserve fund was treated as an appropriation of income after accrual, not a diversion at source by overriding title. The reserve fund remained the society's own asset, available for future business needs, contingencies, losses and debts, so the amount formed part of taxable income. The same transfer was also held not deductible under section 37 of the Income-tax Act because it was not business expenditure incurred wholly and exclusively for business, but a retention of profits for future use. The Revenue's assessment was therefore restored. Case-Laws Income Tax Wed, 21 Apr 2004 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=10403