TMI Blog2016 (11) TMI 1026X X X X Extracts X X X X X X X X Extracts X X X X ..... , JJ. For the Appellant : Sameer Jain ORDER 1. By way of this appeal, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has dismissed the appeal preferred by the department. 2. The following substantial questions of law have been framed by the counsel for the appellant for consideration: 1. Whether the order of the Tribunal is not perverse on facts in as much as it has ignored the specific defects pointed out in the expenses debited to profit and loss account through it has been upheld the rejection of books of accounts u/s 145(3)? 2. Whether the order of the Tribunal is not perverse on facts as it has ignored the fact that the assessee did not produce before the AO the cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion given by the Hon'ble Apex Court (supra). In absence of any such bilateral act on the part of the interested parties, the AO is found not justified in suo-motto, assuming the remission of such liabilities u/s 41(1) of the Act. (d) As discussed above, the courts have also held that the prime obligation, in this regard, lies on the AO, it he intends to consider the trading liability, as deemed income u/s 41(1) of the Act. From the records, it is evident that the AO has failed to discharge the above onus as he could not substantiate her action with necessary supporting material as such. In the case, she has simply arrived at the adverse conclusion as there was no compliance to summons issued to the creditors and the requisite conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is found untenable and unjustified, under the given circumstances, thus, deleted. Consequently, this ground of appeal is upheld. 5. The order of the CIT (Appeal) was confirmed by the Tribunal in para 3.5 which reads as under: We have heard the rival contentions and perused the materials available on record. The main contention of the Revenue was that the assessee has neither filed confirmations nor these parties were produced for examination. On the other hand, the ld. AR submitted that these were the trading liabilities and were not old in nature. Most of the liabilities were of the current year or immediately preceding year and the accounts were active in nature and the transactions were being carried out for the current year as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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