TaxTMI 
TaxTMI 
TaxTMI 
2023 (3) TMI 143
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....) of the Income tax Act [ the Act] by the learned Assessing Officer was allowed. 02. The learned Assessing Officer is aggrieved with the deletion of the addition of Rs.8,46,87,207/- under Section 41(1) of the Act and further the deletion of disallowance of Rs.1,50,000/- out of the expenses claimed on ad hoc basis. 03. The fact shows that assessee is a company engaged in providing civil work as a sub-contractor, filed its return of income on 29th September, 2012 at a total income of Rs.11,93,940/-. The return was selected for scrutiny. The learned Assessing Officer noted from the balance sheet that assessee has trade payable amounting to Rs.8,46,87,207/-. The assessee was asked to submit the confirmation. The assessee could not produce the....
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....counts of the creditors was a running account when there was a opening balance payable to a person as added by the further amounts payable for the work done as reduced by the amounts paid leaving a sum outstanding at the year end, the same cycle repeats year to year. Accordingly, the liability payable to laborers is paid continuously and the question of cessation of liability does not arise. Accordingly, he held that the addition made by the learned Assessing Officer is on mis-appreciation of facts. Thus, the addition was deleted. 06. With respect to the ad hoc disallowance of Rs.1,50,000/-, the learned CIT (A) held that the ad hoc disallowance in case of a company is not valid, proper and legal. He held that the amount of disallowance bei....
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....see. The amount payable to the creditors is outstanding at the end of the year, the bills or the payments made are also adjusted and further the closing balance becomes a running cycle. A continuous payment is made to these parties. Assessee is assessed under Section 143(3) of the Act for A.Y. 2010-11 on 5thMarch 2013, for A.Y. 2011-12 on 25th February, 2014 and for both these years, wherever the liabilities has arisen, there is no finding that these liabilities are not existing. The provision of Section 41(1) of the Act provides that where assessee has obtained any benefit in respect of trading liability by way of remission or cessation same is taxable in the hands of the assessee in the year of cessation. The above liabilities are outstan....
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....he case of CIT v. G.K. Patel & Co. [2013] 29 taxmann.com 248/212 Taxman 384 and the decision of the Delhi High Court in the case of CIT v. Jain Exports (P.) Ltd. [2013] 35 taxmann.com 540/217 Taxman 54 (Mag.). 6. The Delhi High Court in the case of Jain Exports (P.) Ltd. (supra) has relied upon the decisions of the Supreme Court in the case of Bombay Dyeing and Manufacturing Co. Ltd. v. State of Bombay AIR 1958 SC 328 and CIT v. Sugauli Sugar Works (P.) Ltd. [1999] 102 Taxman 713/236 ITR 518. In Sugauli Sugar Works (P.) Ltd. (supra), the Supreme Court has referred to the decision of the Division Bench of this Court in the case of Kohinoor Mills Co. Ltd. v. CIT [1963] 49 ITR 578. The Delhi High Court, after following these decisions conclu....