9911796707
TMI Blog2002 (3) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... re X X X X Extracts X X X X X X X X Extracts X X X X ..... come-tax (Appeals) held that there was no justification to include the sums which were already included in the course of reassessments made for the years 1979-80 and 1980-81. However, he upheld the addition of Rs.3,02,758 pertaining to the assessment year 1978-79. The Appellate Commissioner held that the liability of the assessee finally ceased during the year 1985-86 in view of the rejection of the S.L.P. in Neroth Oil Mills' case [1982] 49 STC 249 (Ker), in November, 1984. Certain observations were also made as regards the includibility of the sums pertaining to the assessment years 1980-81 and 1981-82 in respect of which reassessments were made. However, in this appeal, we need not go into the details thereof. On further appeal by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal and held that section 41(1) cannot be invoked in the instant case. Hence, this appeal by the Revenue by special leave. It may be noted that the provision was made in the books of account towards purchase tax which was under dispute and the benefit of deduction from business income was availed of in the past years in relation thereto. The same was sought to be reversed by the assessee during the year ending on March 31, 1985, for whatever reason it be. The question is whether the circumstances contemplated by section 41(1) exist so as to enable the Revenue to take back what has been allowed earlier as business expenditure and to include such amount in the income of the relevant assessment year, i.e., 1985 86. In order to apply s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the Tribunal. Nor can it be said that the reasons given by the Tribunal are irrelevant. The learned senior counsel appearing for the Income-tax Department has contended that the assessee itself took steps to write off the liability on account of purchase tax by making necessary adjustments in the books, which itself is indicative of the fact that the liability ceased for all practical purposes and therefore, the addition of the amount of Rs.3,20,758 deeming the same as income of the year 1985-86 under section 41(1) is well justified of the Act. But, what the assessee has done is not conclusive. As observed by the Tribunal, a unilateral action on the part of the assessee by way of writing-off the liability in its accounts does not ne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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