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2020 (12) TMI 1023 - AT - Income TaxAddition u/s 41(1) - treating of the outstanding liability of the assessee towards M/s. Aakshi Electrical Sys Pvt. Ltd., as a ceased liability within the meaning of Sec. 41(1) - whether liability has ceased to exist and the appellant has claimed the amount as an expenditure when the liability was created? - HELD THAT:- A.O. had failed to discharge the 'onus' that was cast upon him as regards proving the satisfaction of the aforesaid requisite conditions prior to invoking of the provisions of Sec. 41(1) - Not only that, we find that even otherwise there is nothing discernible from the record which could persuade us to conclude that the benefit, if any, obtained by the assessee by way of remission of cessation of the aforesaid liability could be related to the year under consideration. Lower authorities had shirked from making necessary verifications, which could have safely be done by calling for the requisite details from the aforementioned party i.e. M/s. Aakshi Electrical Sys Pvt. Ltd. But then, we also cannot remain oblivious of the fact that the assessee had also failed to do the bare minimum in order to establish that the liability towards the aforementioned party, though disputed, was however outstanding. Apart from that, except for harping on the fact that the payment to the aforementioned party was towards an advance in lieu of a contract for installations to be carried out in a hospital i.e. a capital expenditure, nothing had been placed on record by the assessee which could irrefutably substantiate the said factual position to the hilt. In the backdrop of the aforesaid facts, we are of the considered view that in all fairness the matter requires to be restored to the file of the A.O. for fresh adjudication - Decided in favour of assessee for statistical purposes..
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