https://www.taxtmi.com/caselaws?id=35995 Section 10(2A) of the Indian Income-tax Act, 1922 applies only where a trading liability, earlier allowed as a deduction, is remitted or ceases to exist. Amounts relating to purchases of goods and interest satisfied that test and were taxable, but the disputed sum of Rs. 1,80,000 did not. It arose from the creditor paying a Bombay supplier on the assessee's behalf and was treated, as between the assessee and creditor, as a borrowing or financing arrangement rather than a liability for stock-in-trade purchases. The deeming provision could not be extended beyond its language, so the addition was rightly deleted. en-us Wed, 02 Apr 1980 00:00:00 +0530 Tue, 02 Dec 2025 20:11:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=35995 Section 10(2A) of the Indian Income-tax Act, 1922 applies only where a trading liability, earlier allowed as a deduction, is remitted or ceases to exist. Amounts relating to purchases of goods and interest satisfied that test and were taxable, but the disputed sum of Rs. 1,80,000 did not. It arose from the creditor paying a Bombay supplier on the assessee's behalf and was treated, as between the assessee and creditor, as a borrowing or financing arrangement rather than a liability for stock-in-trade purchases. The deeming provision could not be extended beyond its language, so the addition was rightly deleted. Case-Laws Income Tax Wed, 02 Apr 1980 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=35995