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...
Corporate Law : Delhi High Court rules in Mukesh Udeshi vs Jindal Steel Power Ltd, emphasizing that only parties to arbitration proceedings can ch...
Income Tax : ITAT Delhi rules against Section 41(1) addition when no cessation of liability occurs, directing cancellation of a demand in the c...
Income Tax : Dive into the detailed analysis of Syama Prasad Mookerjee Port's case against DCIT at ITAT Kolkata regarding Section 41(1) of the ...
Custom Duty : Lovy International challenged rejection of Drawback to ROSCTL conversion. CESTAT Delhi ruled CBEC Circular time limit invalid. Det...
Income Tax : ITAT Mumbai rules in favor of Ecokrin Hygiene Pvt. Ltd., deleting additions under section 41(1) of the Income Tax Act solely based...
Custom Duty : Stay updated with the latest amendment to the Sea Cargo Manifest and Transhipment Regulations, 2018 by the Central Board of Indire...
Loan amount which was never claimed by assessee as expenditure, waiver of same could not amount to cessation of trading liability and was not chargeable to tax under section 41(1).
Surplus resulting from assignment of loan at present value of future liability was not cessation or extinguishment of liability as loan was to be repaid by the third party and therefore could not be brought to tax in the hands of the assessee under section 41(1).
Pr. CIT Vs M/s. Colour Roof (India) Ltd. (Bombay High Court) The Supreme Court in the case of Commissioner v/ s. Mahindra and Mahindra Ltd., [2018] 404 ITR 1 has held that sine-qua-non for application of Section 41(1) of the Act, is that there should have been allowance or deduction claimed by the Assessee in […]
PCIT Vs Pukhraj S. Jain (Bombay High Court) It is well settled through series of judgements that merely because a debt has not been repaid for over three years, would not automatically imply cessation of liability. Exhaustion of period of limitation may prevent filing of recovery proceedings in a Court of law, nevertheless it cannot […]
M/s. West Asia Exports & Imports Vs. ACIT (Madras High Court) We know that Sec 41(1) of Income Tax Act 1961, where there is cessation of any trading liability then the benefit accruing on account of cessation of such liability will be deemed to profits and gains of business or profession whether or not such […]
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
