TMI Blog2023 (11) TMI 648X X X X Extracts X X X X X X X X Extracts X X X X ..... ess the liability ceased to exist during the previous year and the assessee write off the same in its books of accounts. It is also found as a matter of fact that the assessee has made payment to the said party in the next year i.e. AY 2014-15 so the liability cannot be said to have ceased to exist during the year under consideration and the appellant has also not written out the same in its books of accounts. No substantial question of law arises. - HONOURABLE MR. JUSTICE BIREN VAISHNAV AND HONOURABLE MR. JUSTICE BHARGAV D. KARIA Appearance: For the Appellant(s) No. 1: Mrs Kalpana K Raval(1046) For the Opponent(s) No. 1 : None ORAL ORDER (PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA) 1. Heard learned advocate Mr.Nikunt Raval for learned advocate Mrs.Kalpana K. Raval for the appellant. 2. By this Tax Appeal under Section 260A of the Income Tax Act, 1961 (for short the Act ), the appellant-Revenue has raised the following substantial question of law arising out of the order dated 22nd February, 2023 passed by the Income Tax Appellate Tribunal, D Bench, Ahmedabad (for short the Tribunal ) in ITA No. 2764/AHD/2017 for Assessment Year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n undertaken with the said party and the factum of payment of Rs.45 Lakhs to the said party did not appear to be correct since said transaction is not reflected in the bank account of the said party. The Assessing Officer also noted that the proprietor of the said concern has categorically denied any transaction with the assessee and the assessee had also failed to produce any agreement regarding the contract entered with the said party. The Assessing Officer therefore came to the conclusion that the said party was a bogus creditor and outstanding balance reflected in the account of the said party amounting to Rs.8,21,50,309/- was added as income of the assessee by invoking provisions of Section 41(1) of the Act holding that such liability had ceased to exist. 3.5. Being aggrieved, the assessee preferred the Appeal before the CIT (Appeals) who deleted the addition considering the facts of the case and provisions of Section 41(1) of the Act as it has been established that no addition can be made under the said provisions unless the liability ceased to exist and that too during the previous year, the assessee write off the same in its books of account. The CIT (Appeals) held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has maintained proper stock records sales and purchases. The assessee also made statutory deduction of TDS and deposited the same to the government as required under the Income Tax Act and has submitted the TDS certificate. Further, assessee submitted that assessee has maintained the paper stock records and TDS have been deducted as per the provisions of the Act. There is no foul play on the part of the assessee. Assessee has made proper purchase from M/s. Paper Star Marketing cannot be held bogus. Assessee also submitted numerical calculation Stating that there is no sense taking bogus bills as the assessee is incurring more tax burden in accepting bogus bills. 3.9. The Tribunal therefore considering the above findings held that the sundry credit balance again could not have been found non- genuine for the very same reason that the said party has not entered into any transaction with the assessee and therefore no transaction was reflected in the bank account of the said party with the assessee. The Tribunal considering the findings of the Assessing Officer in the preceding Assessment Year 2012- 13 where it was examined by the Assessing Officer and found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction has been made in the assessment for any year in respect of loss, expenditure or trading liability incurred by the assessee (hereinafter referred to as the first-mentioned person) and subsequently during any previous year, (a) the first-mentioned person has obtained, whether in cash or in any other manner whatsoever, any amount in respect of such loss or expenditure or some benefit in respect of such trading liability by way of remission or cessation thereof, the amount obtained by such person or the value of benefit accruing to him shall be deemed to be profits and gains of business or profession and accordingly chargeable to income-tax as the income of that previous year, whether the business or profession in respect of which the allowance or deduction has been made is in existence in that year or not; or (b) the successor in business has obtained, whether in cash or in any other manner whatsoever, any amount in respect of which loss or expenditure was incurred by the first-mentioned person or some benefit in respect of the trading liability referred to in clause (a) by way of remission or cessation thereof, the amount obtained by the successor in business o ..... 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