Sec. 41(1) addition cannot be made for liabilities that had not ceased

M/s Hindustan Vegetable Oils Corp. Ltd. Vs DCIT (ITAT Delhi) Conclusion: AO was unjustified in making addition under section 41(1) on the reason that sundry creditors and other liabilities had ceased to exit as the opening balances of the liabilities were already admitted in the immediately preceding assessment years and the issue for revival was pending before BIFR because of which the creditors remain suspended but there had been no notice which could extinguish the existing right except to the extent that they became part of the sanctioned scheme. Held: Assessee had sundry creditors at Rs. ...