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TMI Blog2017 (3) TMI 1046X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be treated as for business purposes. The Assessing officer was thus clearly in error in resorting to the disallowance on the short ground that while the assessee has borrowed the money on interest, it has given an interest free advance to the sister concern. CIT(A) was justified in reversing the disallowance so made by the Assessing Officer. - Decided in favour of assessee Addition u/s 41 - cessation of liability - assessee has shown an amount due to M/s Planet Star Trading Pvt. Ltd. for more than three years - Held that:- Unilateral entries in the accounts will not amount to cessation of liability, section 41(1) contemplate the obtaining by the assessee an amount either in cash or in any other way whatsoever benefit by way of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . CIT(A) erred in deleting the disallowance of interest of ₹ 95,85,467/-, holding that the advances for the purpose of business of the sister concern are required to be treated as for business purposes as observed by the Supreme Court in the case of S.A. Builders (288 ITR 1 )?" iii. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the disallowance of ₹ 21,07,126/- made u/s 41(1) of the IT Act ignoring the ratio laid down by the ITAT, Mumbai in the case of ITA vs. Sajjankumar Didwani (2014) (47 taxmann.com 381) wherein with regard to the trade liability shown by the assessee it was held that since no confirmation or any other material furnished, the claim of such l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TA No. 4066/Mum/2009 dated 11.01.2012. Ld. DR for the Revenue not disputed the decision for AYs 2004-05 and 2005-06. 4. We have considered the contention of both the parties and seen that similar Grounds of appeal were raised by Revenue for AY 2004-05 and further for AY 2005-06. The Coordinate Bench of this Tribunal while considering the Grounds of appeal passed the following order: "3 We have heard the ld DR as well as the ld AR of the assessee and considered the relevant material on record. At the outset, we note that this issue has been considered and adjudicated by the Tribunal in assessee's own case for Assessment Year 2004-05 in ITA No. 2120/Mum/2008 vide order dated 29th SJR Commodities & Consultancies P Ltd Sept 2011. We furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter, and the CIT(A) was justified in reversing the disallowance so made by the Assessing Officer. We approve the conclusion arrived at by the CIT(A) and decline to interfere in the matter." 5 Therefore, following the order for the earlier year of the Tribunal, we decide this issue in favour of the assessee and against the revenue. 6 In the result the appeal filed by the revenue is dismissed. Therefore, considering the decision of Co-ordinate Bench for earlier years, the Ground Nos. 1 & 2 of appeal raised by Revenue are dismissed. 5. Ground No.3 relates to deleting the disallowance u/s 41(1) of the Act. Ld. DR for the Revenue supported the order of AO and prayed for restoring the order of AO by settingaside the order of ld. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tended for the obtaining benefit to the assessee by virtue of remission of cessation is sine-qua-non for the application of this section. The mere fact that assessee has made an entry or transfer in its account unilaterally will not unable the department to say that section 41(1) of the Act would apply and amount be included in the total income of the assessee. The assessee also relied upon the decision of Sugauli Sugar Works Pvt. Ltd.(supra). The contention of assessee was not accepted by AO while relying upon the decision of T.V. Sundaram Iyenger & Sons Limited (supra) and disallowed the amount. The similar contention was urged before the ld. CIT(A). The ld. CIT(A) after considering the fact, passed the following order: "From the analysi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remission. If no such act takes place then there is no case for holding that a liability has been remitted in favour of the assessee. "Merely because certain amount is outstanding for a number of years it cannot be said that there is cessation or remission. Since in the present case, the assessee has not credited this amount to the profit & loss account in the year under consideration and moreover the assessee has declared this amount in AY. 2013-14 by reflecting the entry of ₹ 21,07,1261- to the profit & loss account, therefore, no addition is called for in the under consideration. In totality of facts & circumstances, it is held that the decision of hon'ble Supreme Court in case of T.V. Sundaram Iyengar & Sons Ltd. relied ..... X X X X Extracts X X X X X X X X Extracts X X X X
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