Deb, J. - (1.) This is a reference under section 256{1) of the Income-tax Act, 1961. The question before us is as follows : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the interest on loan of M/s. Associated Industries (Assam) Ltd. was liable to be included in the assessment for the relevant assessment year ? "
(2.) The statement of the case relates to the assessment year 1970-71. The accounting year ended on 31st December, 1969.
(3.) The assessee is a company. It earned income from business and also from other sources and house property. In an earlier year, the assessee advanced a loan to the aforesaid party mentioned in the question. In 1967 the assessee passed a resolution deciding not to credit the interest on the aforesaid loan on due basis but to credit the same when realised. In terms of the said resolution the assessee did not enter the interest on the said loan in its books as they were not received by the assessee.;