https://www.taxtmi.com/caselaws?id=276108 Interest on non-performing assets for a cooperative bank was not taxable on accrual basis where RBI prudential norms required recognition on receipt basis. Applying the real income theory, the Tribunal held that section 45Q of the Reserve Bank of India Act, 1934 gives overriding effect to RBI directions on income recognition, and the mere adoption of the mercantile system did not make such interest accrue as real income. Section 145 of the Income-tax Act, 1961 governs computation, but it does not displace the mandatory bank-specific recognition regime. The addition for accrued NPA interest was therefore deleted. en-us Thu, 21 Sep 2017 00:00:00 +0530 Tue, 30 Oct 2018 09:59:29 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276108 Interest on non-performing assets for a cooperative bank was not taxable on accrual basis where RBI prudential norms required recognition on receipt basis. Applying the real income theory, the Tribunal held that section 45Q of the Reserve Bank of India Act, 1934 gives overriding effect to RBI directions on income recognition, and the mere adoption of the mercantile system did not make such interest accrue as real income. Section 145 of the Income-tax Act, 1961 governs computation, but it does not displace the mandatory bank-specific recognition regime. The addition for accrued NPA interest was therefore deleted. Case-Laws Income Tax Thu, 21 Sep 2017 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276108