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2016 (9) TMI 946 - ITAT CHENNAIAddition made on account of cessation of bank liability - Held that:- Since there is a categorical findings of the Tribunal that there was a cessation/remission of liability u/s.41(1) of the Act, on earlier occasion confirming the order of ld. CIT passed u/s.263 of the Act, wherein the Ld.CIT directed the AO to verify from the assessment records whether interest/depreciation/hire charges or any other expenditure related to bank liability has been claimed and allowed by the AO in the earlier years and if ‘Yes’, the taxability of the remission of bank liability should be examined by the AO under relevant provisions of the Act. The ld. Assessing Officer consequent to this examined the issue and observed that there is remission of bank liability accrued to the assessee at ₹ 46.05 crores. Contrary to this, Ld.CIT(A) observed that there was no cessation of liability in the hands of assessee and it was only in the hands of URMP(SPV) and if any cessation is to be considered in the hands of URMP. We are not in a position to uphold the argument of the ld.A.R as held by the Tribunal on earlier occasion. There is a remission of liability in favour of assessee company and the liability payable to the bank has been reduced to ₹ 43 crores and it has to be brought to tax in the hands of assessee only u/s.41(1) of the Act. Accordingly, the ground raised by the Revenue is allowed.
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