In the High Court of Punjab and Haryana at Chandigarh ITA No. 363 of 2007 Date of decision: November 22, 2007 Commissioner of Income Tax, Jalandhar-II, Jalandhar ---Petitioner Vs. Dera Baba Karam Singh Hoti Mardanwala ---Respondent Coram: HON'BLE MR. JUSTICE M.M.KUMAR HON'BLE MR. JUSTICE RAJESH BINDAL Present: Mr.Sanjiv Bansal, Advocate, for the appellant. *** M.M.KUMAR, J. This order shall disposed of ITA Nos. 363, 364, 365, 366 and 369 of 2007. All these appeals have been filed under Section 260A of the Income Tax Act, 1961 (for brevity 'the Act') against the consolidated order dated 31.1.2007 (A-3)passed by the Income Tax Appellate Tribunal, Amritsar (for brevity 'the Tribunal'). List of all these appeals along with related number of the appeal before the Tribunal is as under:- Tribunal ITA No. 363/2007 ITA No.316(ASR /2005) Asstt, Year 2001-02 Dated 31.1.2007 ITA No. 364/2007 ITA No.318 (ASR/2005) Asstt, Year 2002-03 Dated 31.1.2007 ITA No. 365/2007 ITA No. 319 (ASR/2005) Asstt, Year 2003-04 Dated 31.1.2007 ITA No. 366/2007 ITA No. 313 (ASR/2005) Asstt, Year 1999-2000 Dated 31.1.2007 ITA No. 363 of 2007 -2- ITA No. 369/2007 ITA No. 311(ASR/2005) Asstt, Year 1998-99 Dated 31.1.2007 The revenue has claimed the following substantial question of law in these appeals:- “That on the fact and in the circumstances of the case, the ITAT is not right in holding that the assessee was justified in declaring its income from interest on FDRs on a cash basis when the evidence clearly show that it has been accounted on a mercantile basis.” The Tribunal has categorically held that the the un-rebutted case of the assessee throughout has been that they are following the cash system of accounting for the interest income earned from the bank and according to Section 145 (1) of the Act, the income chargeable under the head 'profits and gains of business or profession' or ' income from other sources' is required to be computed in accordance with the method of accounting regularly employed by the assessee. Once it has been held that the assessee has been regularly following the cash system of accounting for the interest income earned from the bank, there is no room left for us to conclude that the revenue was entitled to compel the assessee to follow the mercantile system of accounting. Therefore, we find that no question of law, much less the substantial question of law, would arise for our ITA No. 363 of 2007 -3- determination. In view of the above, these appeals fail and the same are dismissed accordingly. (M.M.KUMAR) JUDGE (RAJESH BINDAL) JUDGE NOVEMBER 22, 2007 paramjit