https://www.taxtmi.com/caselaws?id=792836 Section 41(1) applies only where there is a remission or cessation of an existing trading liability; it does not cover receipts that are merely credited in a personal bank account without being reflected as a payable liability in the proprietary books. Here, the surrounding materials, including the affidavit, confirmation of account and bank statement, supported the explanation that the funds were received in a personal capacity from the partner group account and were not an extinguished liability owed to the AOP concern. On that factual basis, the statutory precondition for invoking section 41(1) was not met, and the addition was deleted. en-us Fri, 15 May 2026 00:00:00 +0530 Wed, 03 Jun 2026 13:22:33 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=792836 Section 41(1) applies only where there is a remission or cessation of an existing trading liability; it does not cover receipts that are merely credited in a personal bank account without being reflected as a payable liability in the proprietary books. Here, the surrounding materials, including the affidavit, confirmation of account and bank statement, supported the explanation that the funds were received in a personal capacity from the partner group account and were not an extinguished liability owed to the AOP concern. On that factual basis, the statutory precondition for invoking section 41(1) was not met, and the addition was deleted. Case-Laws Income Tax Fri, 15 May 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=792836