In the case of CIT v. Punjab Agra Industries Corporation Ltd. (119TAX860) the assessee promoted a sister concern in a joint venture with a private Sector Company and advanced loans besides investing in shares. The sister concern went sick. In forming a revival plan the assessee waived off the interest on loans. The P & H High Court held that interest waived is to be allowed as legitimate business expenditure as such expenditure is made to safeguard its share capital and loan.
In the author's opinion if such waiver is exercised in the beginning of the year it may be possible to avoid booking of income itself.