TaxTMI 
TaxTMI 
2013 (2) TMI 723
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....ns of section 41(1) of the Income Tax Act. 2. The brief facts of the case are that the assessee, an individual, was engaged in the business of civil contract, filed his return of income declaring the income at Rs. 2,10,060. The Assessing Officer during the assessment proceedings found that the assessee had shown an amount of Rs. 48,89,025.96 as current liabilities towards sundry creditors. The Assessing Officer asked the assessee to give details of the said sundry creditors along with their name address and also confirmation of the same. The assessee failed to supply the requisite information and, hence, the Assessing Officer treated the said liabilities as income of the assessee and added this amount to the total income of the assessee. A....
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....assessment order has observed as under: "i. After repetitive opportunities during the course of assessment proceedings, the representative for the assessee vide order sheet noting dated 3.11.2009 submitted that the assessee is not able to provide addresses of sundry creditors. The assessee is claiming that these liabilities pertain to period prior to A Y 2002-03 and are due to expenses claimed by her at that time. The statute does not permit to assessee to claim certain business liabilities in its balance sheet ad, at the same, does not disclose details of these business liabilities in the name of limitation act or any other reason. The primary details were privileged knowledge of the assessee and therefore, the assessee had to prove that ....
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.... 344 (SC) "DCIT vs. Hotel Excelsior Ltd." 141 TTJ 248 (Del) "ACIT Circle -1 vs. Samrat Rice Mills (P) Ltd." 54 SOT 1 (Del) "ITO vs. Bhavesh Prints (P.) Ltd." 46 SOT 268 (Ahd) "Kaps Advertising vs. ITO" 48 SOT 63 (Del) "CCIT vs. Kesari Tea Co. Ltd." 254 ITR 434 (SC) "CIT vs. Sugauli Sugar Works (P.) Ltd." 236 ITR 518 (SC) 5. On the other hand, the learned DR has relied upon a recent authority of the Hon'ble Delhi High Court styled as "CIT vs. Chipsoft Technology (P.) Ltd." 210 Taxman 173 (Del), wherein it has been held as under: "9. Two aspects are to be noticed in this context. The first is that the view that liability does not cease as long as it is reflected in the books, and that mere lapse of time given to the creditor or ....
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....operation of law." 6. We may observe that one of the Hon'ble Judges of the High Court of Delhi was part of the Division Bench as in both the authorities i.e. " Shri Vardhaman Overseas Ltd." (supra), and "Chipsoft Technology (P.) Ltd." (supra). Under such circumstances, it cannot be said that both the authorities are contradictory to each other, rather the law laid down by the authority in the case of "Chipsoft Technology (P.) Ltd." (supra), supplements but not supplants the law laid down by the Hon'ble Delhi High Court in the case of "Shri Vardhaman Overseas Ltd." (supra). In the case of "Chipsoft Technology (P.) Ltd.", the Hon'ble High Court has categorically held that it would be illogical to say that a debtor or an employer, holding on ....
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....lished that the assessee had no intention to pay back the debts but in the case in hand, the assessee has refused to divulge the details of creditors because of his intention not to pay back the loan amount as was claimed by him in his reply to the Assessing Officer. Hence, the authorities relied upon by the assessee, as detailed above, are quite distinguishable on their own facts. 7. The case was heard on merits on 22nd Jan 2013 and the judgment was reserved. Now, the assessee vide letter dated 28th Jan 2013 has submitted a statement showing the details of sundry credits from the year 2000 to 2012. It has been further claimed that the amount which was outstanding at Rs. 69,32,307 in the year 2000 has been reduced to Rs. 19,32,372 at the e....