https://www.taxtmi.com/caselaws?id=764317 The dominant issue was whether amounts fraudulently obtained from a Government department by using forged documents, though later recovered/repaid, constituted taxable income in the year of accrual/receipt. The ITAT held that illegality does not affect chargeability; once the assessee had dominion and control and exploited the funds for economic gains (including investments), real income accrued and was taxable in that year, and subsequent restitution could not retrospectively negate taxability, applying the principle in SC authority that later adjustments do not alter original accrual. A further issue was whether repayment/recovery was deductible under s. 57; the ITAT held it was mere restitution, not expenditure incurred wholly and exclusively to earn income, and disallowed it. The additions and disallowances were upheld; appeal dismissed. en-us Tue, 31 Dec 2024 00:00:00 +0530 Mon, 05 Jan 2026 12:00:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=764317 The dominant issue was whether amounts fraudulently obtained from a Government department by using forged documents, though later recovered/repaid, constituted taxable income in the year of accrual/receipt. The ITAT held that illegality does not affect chargeability; once the assessee had dominion and control and exploited the funds for economic gains (including investments), real income accrued and was taxable in that year, and subsequent restitution could not retrospectively negate taxability, applying the principle in SC authority that later adjustments do not alter original accrual. A further issue was whether repayment/recovery was deductible under s. 57; the ITAT held it was mere restitution, not expenditure incurred wholly and exclusively to earn income, and disallowed it. The additions and disallowances were upheld; appeal dismissed. Case-Laws Income Tax Tue, 31 Dec 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=764317