https://www.taxtmi.com/caselaws?id=12132 Under the mercantile system, commission payable to a non-resident agent was deductible in the year the liability accrued, because the obligation arose from an independent agreement and was not contingent on Reserve Bank of India approval. Section 145 required computation in accordance with the regularly employed accounting method, so an accrued and enforceable liability was allowable even though foreign exchange law restricted remittance abroad. The statutory restriction affected only payment and discharge, not accrual, and the possibility of non-remittance did not defer deductibility. The full accrued commission liability was therefore allowable for income-tax purposes. en-us Wed, 11 Sep 2002 00:00:00 +0530 Wed, 17 Feb 2010 19:13:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=12132 Under the mercantile system, commission payable to a non-resident agent was deductible in the year the liability accrued, because the obligation arose from an independent agreement and was not contingent on Reserve Bank of India approval. Section 145 required computation in accordance with the regularly employed accounting method, so an accrued and enforceable liability was allowable even though foreign exchange law restricted remittance abroad. The statutory restriction affected only payment and discharge, not accrual, and the possibility of non-remittance did not defer deductibility. The full accrued commission liability was therefore allowable for income-tax purposes. Case-Laws Income Tax Wed, 11 Sep 2002 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=12132