Mere Lien over payment due to pending dispute does not result in cessation of trading liability u/s 41(1)

Brief about the case The assessee is an individual and prop. of M/s R.S International which is engaged in manufacturing & trading of carpets. He filed his return of total income of Rs. 3,62,880/- on 30/09/2009. The AO completed the assessment vide order dated 30/12/2011 by rejecting the books under section 145(3) and made a total addition of Rs.4512594 composed of Rs. 3745366 being on account of suppressed production and Rs. 703498 being on account of low drawings for household expenses. Aggrieved from the order of ld AO, the assessee filed first appeal challenging rejection of books of ac...