TMI Blog2013 (2) TMI 723X X X X Extracts X X X X X X X X Extracts X X X X ..... the file of the Assessing Officer for fresh assessment in accordance with law and with direction to scrutinize, verify and make necessary investigations regarding the genuineness of the assessee’s claim of repayment to the sundry creditors - ITA No.: 8408/Mum/2010 - - - Dated:- 28-2-2013 - SHRI P M JAGTAP, ACCOUNTANT MEMBER SHRI SANJAY GARG, JUDICIAL MEMBER Appellant By : Shri Prakash Pandit Respondent By : Shri O.P.Meena ORDER Per Sanjay Garg, JM : The present appeal has been preferred by the assessee against the order of the CIT(A) dated 14.10.2010, vide which he confirmed the additions of ₹ 48,89,025 to the income of the assessee made by the Assessing Officer vide assessment order dated 27.11.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the credits pertain to the assessment year prior to A.Y. 2002-03 and that it would not be proper and prudent on the part of the assessee to give confirmation letters from the sundry creditors as by doing so, the period of limitation would start. The assessee also failed to provide the addresses and other details of the creditors. However, at the same time, the assessee claimed before the Assessing Officer that though the limitation period for claiming the amount by the creditor had expired, he had not extinguished the debt so as to prevent the creditors from enforcing the debts against the assessee. He further stressed that only the right to recovery had ceased but not the liability. Hence, he has rightly shown the amount of ₹ 48,89, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or cessation of the liability of the assessee. 4. The authorized representative citing various authorities has submitted before us that the assessee has not written back the accounts of the sundry creditors into profit and loss account. The liability has regularly been shown in the balance sheet. The assessee s liability to the creditors thus subsists and has not ceased, whatever is ceased is the right of the creditors under law to recover the same being barred by limitation in view of the provisions of the Limitation Act 1963. He has pressed that the amount is not thus assessable u/s. 41(1) of the Income Tax Act. He has strongly relied upon the authority of the Hon ble Delhi High Court styled as CIT vs. Shri Vardhaman Overseas Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dues, should be given the benefit of his showing the amount as a liability, even though he would be entitled in law to say that a claim for its recovery is time barred, and continue to enjoy the amount. The second reason why the assessee s contention is unacceptable is because with effect from 1-4-1997 by virtue of Finance Act, 1996 (No.2), an Explanation was added to Section 41 which spells out that loss or expenditure or some benefit in respect of any such trading liability by way of remission or cessation thereof shall include the remission or cessation of any liability by an unilateral act by the first mentioned person under clause . The expression include is significant; Parliament did not use the expression means . Necessarily, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer asked for the details of the creditors he refused to provide the same saying that it would amount to acknowledgement of the debt and the creditors may sue him for recovery of the amount. He even failed to provide the addresses of the creditors, prove the genuineness or the creditworthiness of the creditors. Under law, the assessee cannot be allowed to approbate and reprobate at the same time. On one hand he wants to avoid the liability to pay the tax saying that the amount is legally payable by him as a liability but on the other hand he does not want to pay the said amount to the creditors but enjoy the same without being added to his income. The assessee is blowing hot and cold in the same breath, which in our view is not perm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed by the assessee. We may observe that in the list submitted by the assessee, he has shown to have made certain payments during the A.Ys. 2009-10 and 2010-11. However, neither this fact was brought into the knowledge of the Assessing Officer before completion of the assessment on 27.11.2009 nor this plea or this fact of repayment was brought into the notice of the learned CIT(A) during the pendency of the appeal or till date of order on 14.10.2010. No such plea was taken by the assessee in the grounds of appeal before the Tribunal. It is only after the completion of the arguments that the assessee has come with a new fact that he has been regularly repaying the loan amount to the creditors as detailed in the list. This type of explanat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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