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2018 (6) TMI 549 - AT - Income TaxAdditions u/s 41(1) - cessation of liabilities - written off / remitted liabilities - Held that:- Assessee has gone into BIFR - the claim has been filed before BIFR and therefore the same cannot be considered to have been ceased - it is only a matter of timing that as the issue is pending before BIFR, the creditors remain suspended but there has been no notice which could extinguish the existing right except to the extent that they become part of the sanctioned scheme - hence addition made by AO is unjustified - Decided in favor of assessee. Initiation of penalty u/s 271(1)(c) - Held that:- As per CIT(A), fact that the appellant had not filed appeal against the assessment proceeding is not an unequivocal evidence that it had filed 'inaccurate particulars of income' - thus there is no merit in the action of the AO of levying penalty - since we have already deleted the addition made by AO, which forms basis of levy of penalty, we do not find any infirmity in the penalty being deleted by Ld. CIT (A) - hence appeal of revenue is dismissed.
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