https://www.taxtmi.com/caselaws?id=22562 Interest on sales tax arrears is deductible under the mercantile system only when the liability accrues in law, not when it is later demanded or actually paid. The High Court stated that the statutory obligation to pay interest arises by operation of the sales tax law itself, and interim stay orders or similar directions do not postpone accrual for income-tax purposes. On that basis, the amount paid as interest on sales tax arrears was held not deductible in the relevant assessment year, and the referred question was answered in favour of the Revenue and against the assessee. en-us Tue, 05 Feb 1991 00:00:00 +0530 Fri, 11 Dec 2009 11:51:05 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=22562 Interest on sales tax arrears is deductible under the mercantile system only when the liability accrues in law, not when it is later demanded or actually paid. The High Court stated that the statutory obligation to pay interest arises by operation of the sales tax law itself, and interim stay orders or similar directions do not postpone accrual for income-tax purposes. On that basis, the amount paid as interest on sales tax arrears was held not deductible in the relevant assessment year, and the referred question was answered in favour of the Revenue and against the assessee. Case-Laws Income Tax Tue, 05 Feb 1991 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=22562