TaxTMI 
TaxTMI 
2009 (12) TMI 364
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..../s. Jindal Steel & Power Ltd. (JSPL). Out of the above, JSPL had written off a sum of Rs. 1,46,53,065 in its books of account. In the light of this, when the creditor had written off this amount, the Assessing Officer (AO) treated the same as income of the assessee on the premise that it was no more the liability of the assessee and to this extent it was the assessee's gain and added it under section 41(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The plea of the assessee that JSPL had done it unilaterally and without the knowledge of the assessee, did not convince the Assessing Officer. The Commissioner of Income-tax (Appeals) confirmed the addition made by the Assessing Officer in terms of section 41(1) read ....
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....ally in the appeal with regard to addition under section 41 of the Act is concerned, learned counsel for the appellant/Revenue conceded that section 41 has no applicability to the facts of this case. Precisely, this was the reason for amending the memo of appeal and as the attempt of the Revenue is that the aforesaid amount can still be treated as income at the hands of the assessee within the meaning of section 28 of the Act is not applicable. Therefore, it is this aspect which we are required to discuss in the present appeal. Before we venture into the arena where this controversy is fought between the parties on the merits, it would be necessary to deal with the preliminary submission of the learned counsel for the respondent, who has ar....
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....ess or profession which was carried by the assessee during the previous year shall be treated as income chargeable to income-tax under the head of "Profits and gains of business or profession". The computation of profits and gains referred to in section 28(i) has to be in terms of sections 30 to 43D as is mandated by section 29 of the Act. Thus on this basis, the submission was that the Commissioner of Income-tax (Appeals) confirmed the addition made by the Assessing Officer under section 41(1) of the Act read with section 28(i) of the Act, which does not create any separate charge. On the other hand, section 28(iv) deals with an altogether different aspect, viz. : "(iv) the value of any benefit or perquisite, whether convertible into mo....
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....on was treated as financial transaction and depreciation was disallowed. It was in this backdrop, the Supreme Court opined that the depreciation given to the assessee could not be withdrawn, more so when the finding of fact that the transaction in question was lease and not financial transaction had become final and had not been challenged. 9. With this, we proceed to examine this aspect on its own merits, viz., whether the provisions of section 28(iv) of the Act are attracted in the given case. Thus, what is to be seen is as to whether the amount written off of Rs. 1,46,53,065 in its books of account by JSPL amounts to the value of any benefit or perquisite whether convertible into money or not and can be treated as "Profits and gains f....