Taxability of waiver of loan taken for acquiring capital asset

Section 41(1) -Remission or cessation of trading liability –  When loan is taken for acquiring capital asset, waiver thereof would not amount to any income exigible to tax; on other hand, if loan is for trading purpose and has been treated as such from very beginning in books of account, waiver thereof may result in income, more so when it is transferred to profit and loss account. Fact:  Loans/advances were taken by assessee-company from company B in course of its business activity. Company B approached assessee-company to clear its dues as they had immediate business obligation. Old ...