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2014 (12) TMI 969 - AT - Income TaxAddition u/s 28(iv) r.w. section 41 r.w. explanation 2(iv) – loan waived by the lenders - Deduction of amount from the amount of reduction of loans and liabilities - Held that:- Following the decision in Commissioner of Income-Tax Versus Chetan Chemicals Pvt. Ltd. [2001 (10) TMI 12 - GUJARAT High Court] wherein it has been held that before the section can be invoked, it is necessary that an allowance or a deduction has been granted during the course of assessment for any year in respect of loss, expenditure or trading liability which is incurred by the assessee, and subsequently during any-previous year the assessee obtains, whether in cash or in any other manner, any amount in respect of such trading liability by way of remission or cessation of such liability - In that case, either the amount obtained by the assessee or the value of the benefit accruing to the assessee can be deemed to be the profits and gains of business or profession and can be brought to tax as income of the previous year in which such amount or benefit is obtained - it cannot be said that the assessee-company was carrying on business of obtaining loans and that the remission of such loans by the creditors of the company was a benefit arising from such business – thus, the amount waived by the lender bank is not an income u/s 2(24) of the Act and further Section 28 also does not include amount of loan waive by the lender u/s 41 of the Act cannot apply to this receipt in respect of this amount – Decided against revenue.
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