Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (8) TMI 1067 - AT - Income TaxCessation of liabilities u/s 41(1) - CIT(A) applying the provision of section 28(iv) thereby, modifying the assessment order - HELD THAT:- As far the question of cessation of liability in respect of Green Press Pvt. Ltd. is concerned, the assessee has placed reliance on various case laws by the more particularly judgement of Jain Exports (P.) Ltd. [2013 (5) TMI 690 - DELHI HIGH COURT] and Batliboi Environmental Engineering Ltd. [2022 (6) TMI 903 - BOMBAY HIGH COURT] as concluded that merely because the liability is barred by limitation, it does not cease to be a debt. This view is also taken by this court in the case of CIT v. Indian Rayon and Industries Ltd. [2010 (3) TMI 299 - BOMBAY HIGH COURT] Therefore, the submission made by the appellant that because the liability is barred by the period of limitation the same would be treated as income and added under section 41(1) of the Act cannot be accepted as no other decision contrary to the above is shown to us. Thus, the second question of law does not survive for consideration. Thus AO erred in making addition treating the cessation of liability and CIT(A) erred in applying the provision of section 28(iv) of the Act, thereby, modifying the assessment order. The grounds so raised by the assessee deserve to be allowed.
|