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2022 (9) TMI 1145 - AT - Income TaxAddition u/s 41(1) - cessation of liability as the payment was done in the earlier year - HELD THAT:- The material was supplied to the assessee-company, even if it is considered that the said payment was made by director, why the assessee has not shown such liability against director in its books. The case law relied by assessee Matruprasad C. Pandey [2015 (4) TMI 830 - GUJARAT HIGH COURT] is not applicable on the facts of present case as held that amount of old sundry creditors appearing in balance sheet cannot be added under section 41(1) unless and until it is found that there was remission/cessation of liability and that too during relevant assessment year. (underlined by us) As recorded above, during the remand report, the creditor clearly replied that he has already received payment against the supply of sand - FY 2011-12, thus, the liability to make payment was cessed long back, thus, we affirm the order of ld CIT(A). Grounds of appeal raised by the assessee are dismissed.
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