Case Law Details
Case Name : DCIT Vs. Allied Leather Finishers Pvt. Ltd. (ITAT Lucknow 'B' Bench)
Related Assessment Year :
Courts :
All ITAT ITAT Lucknow
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RELEVANT PARAGRAPH
17. Regarding the addition made u/s 41(1), we are of the view that the Assessing Officer has incorrectly invoked this provision. There is neither any remission nor cessation of the liability. The Assessing Officer has simply added all the credits appearing in the balance sheet which could not be hit by Section 41(1).
The liability to the assessee should cease to exist either due to operation of law or by an
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Dear Tax guru,
I have not yet received any message from your end regarding sited case laws in respect of old creditors against purchase can be disallowed or added to the income of the current year stating bogus.Please site case laws on the subject.
With regards,
N.r.Datta. FCA
Case Law relating to ITAT LUCKNOW BENCH-B in the case of DCIT Vs. Allied Leather Finishers P.Ltd is only not being a trading liability which cannot be disallowed and taken as income u/s.41(1).
But in case of old Sundry Creditors against purchase whether this can be disallowed/added to the income of the current year stating as bogus. please site case laws in the above matter.
Case law may kindly be provided relating the nature that old Creditors can be disallowed during the current year of assessment.
The case law referred to above relating to the liability not being the trading nature but in case of Sundry Creditors against purchase which are old can be disallowed in the current of assessment? Answer may kindly be furnished.