TMI Blog2008 (9) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... of liability hence AO made addition – held that remission of the principal amount of loan didn’t amount to income - remission would become income u/s 41(1) only if assessee has claimed deduction in respect of expenditure or trading liability - 1143/2008 - - - Dated:- 23-9-2008 - BADAR DURREZ AHMED and RAJIV SHAKDHER, JJ. For the Appellant : Mr R. D. Jolly 1. This appeal by the reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pital Reserve Account. According to the Assessing Officer the assessee had derived benefit on the basis of either depreciation or utilizing the working capital which would have formed part of the earlier year's income. According to the Assessing Officer since the loans ceased to exist, this amounted to cessation of liability and, therefore, it has to be treated as an income. Consequently, the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of Section 41 (1), the first requisite condition to be satisfied is that the assessee should have got deduction or benefit of allowance in respect of loss, expenditure or trading liability incurred by it and subsequently during any previous year, the assessee should have received any amount in respect of such loss, expenditure or trading liability by way of remission or cessation thereof. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... waiver of interest is concerned, the assessee company itself has treated the same either as income or has not claimed the same as expenditure in the computation of income filed before the lower authorities." 4. We see no reason to interfere with the conclusions of the Tribunal as the same have been rendered on a correct appreciation of law. The principles enunciated in Mahindra and Mahindra L ..... X X X X Extracts X X X X X X X X Extracts X X X X
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