2011 (12) TMI 777

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....dent : P.C. Maurya. ORDER Per Pramod Kumar: 1. By way of this appeal, the assessee-appellant has challenged correctness of CIT(A)'s order dated 31st October, 2010, in the matter of assessment under section 143(3) of the Income tax Act, 1961, for the assessment year 2005-06 on the following grounds: "1. The ld CIT(A) erred in facts and in law and under the circumstances in erroneo....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....t called for." 3. To adjudicate on this appeal, only a few material facts need to be taken note of. The assessee is a franchise for providing computerized information. During the course of assessment proceedings, the Assessing Officer noticed that the assessee had received a sum of Rs.10,00,000 from Indian Infochem Pvt. Ltd., on 16.6.2000 as advance against gross consideration of Rs.25,00,000 o....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... justifiably a cessation of liability. The Bombay High Court in CIT vs. General Electrodes & Equipments Ltd (1985) 155 ITR 78 (Bom) has recognized that the benefit of extinction of liability which had continued un-discharged is covered u/s.28(iv) of the I.T. Act. In protos Engineers Co Ltd vs. CIT (1995) 211 ITR 919 (Bom), it was held that advances against public supplies (unclaimed balances) rece....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the amount in question was received in the year 2000, relevant to the assessment year 2001-02, and that nothing happened during the relevant previous year so as to provoke it's taxability u/s.28(iv). The year before us is neither the year of receipt nor a year in which any material development took place so as to alter the character of receipt. It is not the case of the revenue that liability has ....