Goods and Services Tax : Explore the critical implications of Section 16(4) of the CGST Act, 2017 on taxpayers' Input Tax Credit (ITC) eligibility and the ...
Income Tax : Explore the intricacies of Income Tax Section 41, covering allowances, deductions, and financial transactions. Real-world examples...
Income Tax : Whether Remission Of Trading Liability Separately Taxable Where Income From Business Has Been Declared On Presumptive Basis U/S 44...
Income Tax : Any person being Individual/HUF/Company/Firm/LLP etc. providing any benefit or perquisite whether convertible into money or not, i...
Income Tax : ISSUE FOR CONSIDERATION When a loan taken for acquiring a depreciable capital asset or a part of the purchase price of such capita...
Income Tax : The ITAT Delhi held that the Revenue could not substitute the assessee's consistent method of revenue recognition with the Percent...
Income Tax : The Tribunal held that interest under Section 244A must be computed up to the actual date of refund issuance. Restricting interest...
Income Tax : Adjustment under section 143(1)(a)(iv) based on disallowance reported in Form 3CD was held to be within CPC's jurisdiction. Howeve...
Income Tax : Tribunal held that deduction for bad debts is allowable in the year in which the debts are actually written off in the books of ac...
Income Tax : The ITAT Raipur held that additions for cessation of liability cannot be made merely because creditor confirmations were not filed...
Custom Duty : Stay updated with the latest amendment to the Sea Cargo Manifest and Transhipment Regulations, 2018 by the Central Board of Indire...
Sh. Jai Pal Gaba Vs ITO (ITAT Chandigarh) The very language of the section 28(iv) speaks about the value of any benefit or perquisite arising from business or exercise of a profession. Now considering the facts and circumstances of the case, though, the loan was taken for the purpose of business but the same was […]
Can A.O. could invoke section 41(1) on the pretext that liability has been long outstanding and the assessee is willingly not writing off the debts from its books? Section 41(1) is not applicable when the long outstanding liabilities have not been written off from books of accounts and continue to be reflected in the Balance […]
AO was unjustified in making addition under section 41(1) on the reason that sundry creditors and other liabilities had ceased to exit as the opening balances of the liabilities were already admitted in the immediately preceding assessment years and the issue for revival was pending before BIFR because of which the creditors remain suspended but there had been no notice which could extinguish the existing right except to the extent that they became part of the sanctioned scheme.
Merely because liability was outstanding, it could not be presumed that the said liabilities had ceased to exist. Since the liability did not cease to exist and the assessee had acknowledged debt in his books, the same could not be taxed under section 41(1).
Alfa Laval India Ltd. case: Difference between the Net Present Value against the future liability credited by the assessee under the capital reserve account in its books of account, is a capital receipt, the addition made on account of the gain on settlement of the sales tax deferred liability not taxable
DCIT Vs. Babcock Borsig Ltd. & Vice-Versa (ITAT Kolkata) Liabilities brought forward from amalgamating company written off by the amalgamated company (assessee) become its Business income- i.e. Profit chargeable to tax under section 41(1) of Income Tax Act, 1961 as the assessee had written off the liabilities after coming to a conscious conclusion that those […]
Section 41(1) provides for taxing any amount benefit which was obtained by a person with respect to any loss, expenditure or trading liability incurred in any earlier Assessment Years. The Section is re-produced as under
Waiver of loan for acquiring capital assets could not be taxed as perquisites under section 28(iv) since receipts were in the nature of cash or money. Section 41(1) of the Income Tax Act does not apply since waiver of loan does not amount to cessation of trading liability. It is a matter of record that the assessee had not claimed any deduction under section 36(1)(iii) of the IT Act qua the payment of interest in any previous year.
Where amount forfeited by assessee against cancellation of booking of flat was subject-matter of civil suit, it could not be said that there was cessation of liability so as to tax such amount as assessee’s income.
Where due to pending disputes with debtors, sales commission could not be paid to agents for longer period, taxation of such liability payable to agents under section 41(1) was not justified.
