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TMI Blog2023 (9) TMI 1505X X X X Extracts X X X X X X X X Extracts X X X X ..... e present case the alleged sum is the balance of outstanding loan. The assessee took loan but the same has remained outstanding in the balance sheet only and it has never been claimed as a trading liability. Only the interest paid on such sum has been claimed as an expenditure. Even the assessee has also claimed that the loan liability was live as on the closing date of the year under appeal and this company was struck off at a later stage. Thus, we are of the considered view that only the interest expenditure claimed by the assessee during FY 2001-02 needs to be added back to the income of the assessee but so far as the remaining amount is concerned it being not in the nature of trading liability, cannot be added in the hands of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise, the loan written off is not assessable u/s 41(1) of the Act 5. For that under the facts and circumstances of the case, the addition made by the Ld. AO is liable to be deleted. 6. For that the appellant be given relief as prayed for. 7. For that the appellant craves leave to add, alter or withdraw any ground/s of appeal on or before hearing of the appeal. 3. The facts in brief are that the assessee is private limited company engaged in the business of investment house property and income of Rs. 31,11,681/- declared in the return for AY 2011- 12 furnished on 22.09.211. Assessment was completed u/s 143(3) of the Act on 26.03.2014 assessing income at Rs. 57,25,440/-. Thereafter the additions made in the assessment order were challenged by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 26,13,757/- is in challenge before us. We notice that the assessee took unsecured loan of Rs. 24.50 Lakh from M/s. Lahar Commodities Pvt. Ltd. during FY 2001-02. During FY 2001-02 the interest of Rs. 2,05,725/- was debited and on which TDS of Rs. 41,960/- was deducted and the net credit balance stood at Rs. 26,13,757/- and the same was being carried forward year to year. During the course of assessment proceedings for AY 2011-12, in compliance to the order of this Tribunal u/s 254 of the Act dated 06.12.2017 ld. AO noticed that the alleged sum of Rs. 26,13,757/- has remained unpaid from FY 2001-02 onwards till AY 2011-12. Ld. AO accordingly invoked the provisions of Section 41(1) of the Act and added the same to the income of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we notice that the same refers to a trading liability. For instance, the assessee purchases goods and the sundry creditor is appearing in the balance sheet and the same has remained unpaid for a long time and the assessee fails to prove that such liability is existing/live then in such cases Section 41(1) of the Act can be invoked. So far as the case before us is concerned the alleged sum of Rs. 26,13,757/- is the balance of outstanding loan. The assessee took loan of Rs. 24.50 Lakh but the same has remained outstanding in the balance sheet only and it has never been claimed as a trading liability. Only the interest paid on such sum at Rs. 2,04,725/- has been claimed as an expenditure. Even the assessee has also claimed that the loan liab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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