Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2019 (10) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (10) TMI 88 - BOMBAY HIGH COURTAddition as income u/s 41(1) OR u/s 28 - cessation of loan liability - HELD THAT:- The Supreme Court in the case of Commissioner v/ s. Mahindra and Mahindra Ltd. [2018 (5) TMI 358 - SUPREME COURT] has held that sine-qua-non for application of Section 41(1) is that there should have been allowance or deduction claimed by the Assessee in any Assessment Year as a loss, expenditure or trading liability incurred by the Assessee. Subsequently, if any remission or waiver is granted in respect of which such an allowance/deduction has been claimed, then the Assessee is liable to pay t ax on the amount waived/ remitted under Section 41(1) of the Act. This, as the Court held is only to ensure that Assessee does not keep double benefit – one by way of deduction and another by waiver of the amount, which has already been deducted in computing the tax; In this case admittedly, no benefit in respect of the loan has been claimed by the Respondent in respect of ₹ 4.11 Crores, in an earlier Assessment Year. Addition u/s 28 - at no point of time before the authorities under the Act, was it the Revenue’s case that the waiver of loan should be brought to tax under Section 28 (iv) of the Act. No such claim was made either as a principal submission or even in the alternative. Therefore, it is not open for the Revenue to urge an issue which was not urged before the Tribunal. On this limited ground, the two questions as proposed are liable to be dismissed. The issue now stands concluded by the decision of the Apex Court in Mahindra and Mahindra (supra). In the above case, the Apex Court has held that, Section 28 (iv) of the Act can only apply where any benefit arises from a business or profession and such benefit is received other then in the shape of money. In this case, the waiver of loan is, in fact, found is on capital account. - Decided against revenue.
|