A Company pays a lesser amount towards Bank loan under one Time settlement arrangement.
There are lot of decisions to say that amounts waived off by the bank cannot be brought to Income tax under section 41(1) of Income Tax Act.
These decision pertain to period before introduction of Section 56(2)(viia).
My Query is whether such loans waived off will be treated as Income under section 56(2)(viia) or 56(2)(x) in the hands of the company.
Bank Loan Waiver Under One-Time Settlement: Not Income Per Sections 56(2)(viia) or 56(2)(x), Expert Opinion Invited A company inquires whether a bank loan amount waived under a one-time settlement would be considered income under sections 56(2)(viia) or 56(2)(x) of the Income Tax Act. Previously, decisions indicated such waived amounts were not taxable under section 41(1) before the introduction of section 56(2)(viia). An expert responds, expressing the opinion that the waived amount should not be treated as income, and invites further expert opinions on the matter. (AI Summary)
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