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Commissioner of Income Tax-2, Mumbai Versus M/s. Elde Electricals Agencies Pvt. Ltd., Mumbai

2015 (7) TMI 16 - BOMBAY HIGH COURT

Addition made under Section 41(1) - creditors outstanding for more than three years in the books of respondent-assessee - ITAT deleted the addition - Held that:- In the present facts, the amount of ₹ 64.27 lacs continues to be shown as the liab .....

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amount of ₹ 64.27 lacs continues to be shown in its balance-sheet as a liability. Consequently, the occasion to invoke the Explanation1 to Section 41 of the Act does not arise. The settled position in law is that showing the amount due to the c .....

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16-6-2015 - M. S. Sanklecha And N. M. Jamdar,JJ. For the Appellant : Mr Suresh Kumar For the Respondent : None ORDER P.C. This appeal by the revenue challenges the order dated 30 January 2013 passed by the Income Tax Appellate Tribunal (the Tribunal) .....

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in circumstances of the case and in law the Tribunal was justified in deleting the addition made under Section 41(1) of the Income Tax Act, 1961 of ₹ 64,27,366/ representing creditors outstanding for more than three years in the books of respo .....

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in the case of Commissioner of Income Tax v/s Kesaria Tea Company, reported in 254 ITR 434 in deciding the case? 3. During the course of the assessment proceedings for the subject assessment year, the Assessing Officer noticed that the sundry credito .....

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of ₹ 64.27 lacs be added to the respondent-assessee's income under Section 41(1) of the Act being the creditors outstanding for more than three years had ceased. The respondent-assessee's submission that the said amount of ₹ 64.27 .....

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e extent of ₹ 64.27 lacs. Thus, there was no question of cessation of liability for the purpose of attracting Section 41(1) of the Act. Consequently, the appeal of the respondent-assessee was allowed. 5. On further appeal, the Tribunal upheld t .....

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ecisions relied upon by the Tribunal dealt with a period prior to 1 April 1997. It was pointed out that Explanation1 to Section 41 was introduced with effect from 1 April 1997 which inter-alia provided that even a unilateral act by a party by way of .....

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