https://www.taxtmi.com/caselaws?id=758104 ITAT Ahmedabad dismissed revenue's appeal regarding cessation of liability under Section 41(1), holding that AO failed to provide concrete evidence of liability cessation, as outstanding trade payables in balance sheet remain valid until proven otherwise. The tribunal upheld CIT(A)'s deletion of 10% disallowance of trade payables under Section 37(1), finding AO's approach arbitrary without substantial evidence. Personal expenses disallowance was also deleted as AO relied on assumptions rather than proof. However, ITAT allowed assessee's appeal on interest disallowance under Section 36(1)(iii), applying fungibility of funds doctrine, and deleted Section 14A disallowance due to absence of exempt income. en-us Tue, 27 Aug 2024 00:00:00 +0530 Thu, 05 Sep 2024 16:37:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=758104 ITAT Ahmedabad dismissed revenue's appeal regarding cessation of liability under Section 41(1), holding that AO failed to provide concrete evidence of liability cessation, as outstanding trade payables in balance sheet remain valid until proven otherwise. The tribunal upheld CIT(A)'s deletion of 10% disallowance of trade payables under Section 37(1), finding AO's approach arbitrary without substantial evidence. Personal expenses disallowance was also deleted as AO relied on assumptions rather than proof. However, ITAT allowed assessee's appeal on interest disallowance under Section 36(1)(iii), applying fungibility of funds doctrine, and deleted Section 14A disallowance due to absence of exempt income. Case-Laws Income Tax Tue, 27 Aug 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=758104