Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (3) TMI 383 - AT - Income TaxAddition on account of cessation of liability for purchase of immovable property, when in fact the payment of liability was not proved and established - CIT-A deleted the addition - HELD THAT:- Both the parties confirmed outstanding amount. Therefore, Seller has confirmed the amount receivable and the buyer has also accepted its liability for payment of the above sum. Further for the applicability of the provisions of section 41(1) of the Act there is no benefit arising in favour of the assessee. It is merely an outstanding payable to Sundry Creditors for purchase of stock in trade. On looking at the balance sheet of the assessee, it is also seen that there are some land owned by the assessee at Alibaug. Therefore it cannot be said that the explanation for the above outstanding sum is also false. The learned CIT(A) also asked for the remand report from the Assessing Officer which clearly showed that the only payment made by the assessee was of ₹ 10 lacs and the cheques mentioned in the sale deed were not enchased - we find that the liability still exists and the manner of discharge of above liability has also been agreed by the parties. There is no cessation of liability in the hands of the assessee as the liability is live and existing. Therefore, the ld CIT (A) has deleted the addition made by the learned Assessing Officer under section 41(1) - Further in absence of any contrary evidence, the Assessing Officer is not correct in stating that assessee might have paid the above sum out of its unaccounted income. To reach at such conclusion, no evidences are shown before us. Therefore, we do not find any infirmity in the order of the learned CIT (A). in deleting the above addition. - Decided against revenue.
|