https://www.taxtmi.com/caselaws?id=59035 An assessee may change from one regularly employed accounting method to another recognised method if the shift is bona fide, consistently followed, and needed to compute true income. Where bonus had become a statutory liability and accrued at year-end, adoption of the mercantile basis was permissible and the accrued bonus was allowable. Where recovery of principal was doubtful due to disputes and litigation, adoption of the cash basis for interest receivable was also permissible, and unrealised interest did not constitute taxable income. The governing principle is that income cannot be taxed on a mere notional accrual when it has not truly arisen. en-us Mon, 23 Jan 1984 00:00:00 +0530 Thu, 23 Dec 2010 16:32:40 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=59035 An assessee may change from one regularly employed accounting method to another recognised method if the shift is bona fide, consistently followed, and needed to compute true income. Where bonus had become a statutory liability and accrued at year-end, adoption of the mercantile basis was permissible and the accrued bonus was allowable. Where recovery of principal was doubtful due to disputes and litigation, adoption of the cash basis for interest receivable was also permissible, and unrealised interest did not constitute taxable income. The governing principle is that income cannot be taxed on a mere notional accrual when it has not truly arisen. Case-Laws Income Tax Mon, 23 Jan 1984 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=59035