S. 41(1) applies only to trading liability not to other types of liabilities

RELEVANT PARAGRAPH 8. We have the rival contentions and gone through the facts and circumstances of the case. We have also perused the case records including the assessment order, the order of CIT(A) and the assessee’s paper book. We have also gone through the case laws relied on. We find that the assessee has received an amount of Rs. 2.93 crores from Soumya Construction Pvt. Ltd. and shown the same as liability in balance-sheet for assessment year 1997- 98. The assessee has not shown the same as trading liability and nor claimed any deduction or expense in that assessment year. During ...