1938 (4) TMI 6

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.... 1937. The question required to be stated was "Whether in fact in respect of this debt the assessee has been assessed to Income Tax in respect of the accrual of interest on this debt it being not clear how the debt can be treated as having been wiped off in 1930 if interest is to be treated as having accrued since that date on the debt". In my statement I am paraphrasing the question put by the Ch....

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....btor from all further liability. This statement was repeated by the Commissioner on the 30th July 1937 in the case stated by him on that date, the case which we have before us in this application. There was further fact which must be mentioned for the purpose of noting the position of the matter. It is a finding by the Commissioner that the assessee prepares his account on the mercantile system. T....

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....th regard to this matter : the first is the finding of the Commissioner that by the taking over of the debts of Bhagwandas in 1930 the liability of that person (the debtor) was wiped out, and that the assessee had no further rights with regard thereto. If that correctly states the fact, then the question whether the debt became statute barred in the year of assessment does not arise. It ceased to ....

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...., J. - I agree. The fact stated by the Income Tax Commissioner at more places than one in the paper-book, that in 1930 the assessee in the interest of himself and the other co-creditors took over the assets of the debtor and released the debtor of all further liability, and the circumstance that the assessee did not in subsequent years include the debt in his returns (such as they were) which he m....