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2017 (5) TMI 195 - AT - Income TaxTrading addition - rejection of books of accounts - CIT-A reducing trading addition - Held that:- CIT(A) has taken into account the increase in the turn over which is not controverted by the Revenue. Therefore, there is no infirmity into the order of Ld. CIT(A), same is hereby affirmed. Thus, this ground of the Revenue’s appeal is dismissed. Addition on account of ceased liability u/s 41(1) - Held that:- We find merit in the contention of the appellant as the AO neither had made any inquiries nor brought any material on record that the creditors either had written off the said liabilities in their book of accounts or denied to own these amounts. In considered opinion, no addition u/s 41(1) can be made merely on the ground that the debts remained unpaid in the appellants’ books for a number of years and no presumption can be made that the said liability had ceased or had been remitted. It is noted from the assessment order that out of the 4 invoiced, the payments for which outstanding as on 31.03.2012, the 2 were pertaining to the AY 2012-13 i.e. the year under consideration and 1 each was pertaining to AY 2010-11 and 2011-12, and thus as on 31.03.2012, these debts were not even barred by limitation. Thus AO was not justified in making addition u/s 41(1) of the Act - Decided against revenue
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