No Addition for Cessation of Liability if no Evidence of Remission: ITAT Mumbai

Action Gold Vs DCIT (ITAT Mumbai) In this case before the Income Tax Appellate Tribunal Mumbai, the assessee challenged the addition made under Section 41(1) of the Income Tax Act, 1961 on account of alleged cessation of liability relating to two sundry creditors. The assessee had declared income for Assessment Year 2022–23 and during scrutiny proceedings, the Assessing Officer identified outstanding balances of ₹28,69,575 in respect of two creditors. The assessee explained that these liabilities arose from disputes relating to jewellery manufacturing contracts, where finished goods were n...