2008 (9) TMI 31

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....der dated 31.07.2007 passed by the Income Tax Appellate Tribunal in ITA 4922/Del/2005 in respect of the assessment year 2001-2002. 2.    The assessee was engaged in the manufacturing of black and white picture tubes. The assessee company ran into huge losses and it ultimately became a sick company and registered with the BIFR. Under the one time settlement scheme, the financial ins....

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....dded the said sum of Rs 10.47 crores in the income of the assessee. The Commissioner of Income Tax (Appeals) deleted the addition by observing that the remission of the principal amount of loan did not amount to income under Section 41 (1) nor under Section 28 (iv) nor under Section 2(24) of the Income Tax Act, 1961 (hereinafter referred to as the "said Act"). 3.    The revenue wen....

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....emission would become income only if the assessee has claimed deduction in respect of expenditure or trading liability. In Mahindra and Mahindra Ltd. Vs. CIT, Hon'ble High Court of Bombay 261 ITR 501, held that no allowance or deduction having been allowed in respect of loan taken by assessee for purchase of capital assets, Section 41 (1) was not attracted to remission of principal amount of loan.....