https://www.taxtmi.com/caselaws?id=49365 Income accrues when the assessee acquires an enforceable right to receive it, and under the mercantile system it is taxed in the year that right comes into existence. A compensation amount referable to an earlier supply contract was therefore not taxable in the earlier period merely because it arose from that transaction; it accrued only in the later year of payment and was assessable in that year. The analysis also notes that the Act does not permit later-accruing income to be related back to an earlier year, and that reopening closed accounts is not the governing test because the statute provides specific machinery for escaped income or mistakes. en-us Thu, 16 Apr 1964 00:00:00 +0530 Sat, 23 Aug 2014 12:09:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=49365 Income accrues when the assessee acquires an enforceable right to receive it, and under the mercantile system it is taxed in the year that right comes into existence. A compensation amount referable to an earlier supply contract was therefore not taxable in the earlier period merely because it arose from that transaction; it accrued only in the later year of payment and was assessable in that year. The analysis also notes that the Act does not permit later-accruing income to be related back to an earlier year, and that reopening closed accounts is not the governing test because the statute provides specific machinery for escaped income or mistakes. Case-Laws Income Tax Thu, 16 Apr 1964 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=49365