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2017 (12) TMI 252 - HC - Income TaxAddition u/s 41 - cessation of liability - Held that:- To attract the provisions of sub-section (1) of section 41 of the Act, the revenue has to either show that such liability has in fact ceased to exist or that the assessee has written off such liability in his accounts. In the facts of the present case the assessee continues to acknowledge the liability in his accounts and there is nothing to show that on account of lapse of time the liability has ceased to exist. Under the circumstances, the Tribunal was wholly justified in holding that it cannot be said that the liability has ceased and deleting the addition ADMIT. The following substantial questions of law arise for consideration. (1) Whether on the facts and in the circumstances of the case the Income Tax Appellate Tribunal was justified in deleting the addition of ₹ 23,04,369/- by considering the same to be service tax? (2) Whether on the facts and in the circumstances of the case the Income Tax Appellate Tribunal was justified in deleting the addition of ₹ 53,600/- made under section 40(a)(ia) of the Income Tax Act, 1961? (3) Whether on the facts and in the circumstances of the case the Income Tax Appellate Tribunal was justified in deleting the addition of Rs,1,95,250/- on account of addition made under section 40A(3) of the Income Tax Act, 1961?
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