No Addition u/s 41(1) Merely Because Liability Outstanding for Long Period

PCIT Vs Adani Agro (P.) Ltd. (Gujarat High Court) The issue under consideration is whether the addition made by AO under Section 41(1) of the Act on account of cessation of liability is justified in law? High Court states that, once assessee had continued to show admitted amounts as liabilities in its balance sheet, the same could not be treated as a case of cessation of liabilities merely because liabilities were outstanding for last many years, it could not be inferred that such liabilities had ceased to exist. Therefore, when both the authorities have arrived at finding of fact that the lia...