Shri Vijay Arora, Faridabad V. ACIT, Gurgaon

ITA 3881/DEL/2015

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1496 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: F
• Assessment Year: 2009-2010
• Appeal Filed On: 12-06-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Keywords: Additional evidence
• Section: 142(1); 131; 68

Judgement Text

ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: F, NEW DELHI BEFORE SMT. BEENA A PILLAI, JUDICIAL MEMBER AND SHRI MAHARISHI PRASHANT, ACCOUNTANT MEM BER ITA NO. 3881/DEL/2015 AY: 2009-10 SH. VIJAY ARORA C/O SH.VIJAY KUMAR GUPTA, ADV. OPP. JAIN MANDIR MAIN BAZAR BALLABGARH FARIDABAD 121 004 PAN: AFMPA3846F VS . ACIT, CIRCLE 1(1) HSIIDC BUILDING VANIJYA NIKUNJ UDYOG VIHAR GURGAON (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. VIJAY KUMAR GUPTA, ADV. DEPARTMENT BY : SH. SURENDER PAL, SR. D.R. DATE OF HEARING : 01/11/2018 DATE OF PRONOUNCEMENT : 27/11/2018 ORDER PER BEENA A PILLAI, JUDICIAL MEMBER PRESENT APPEAL HAS BEEN FILED BY ASSESSEE AGAINST O RDER OF LD.CIT(APPEALS)-1, GURGAON DATED 04.03.2015 FOR A .Y 2009-10 ON THE FOLLOWING GROUNDS OF APPEAL: I) THAT IN THE BALANCE SHEET FOR THE YEAR ENDING 31/03/2009 [AY 2009-10] THERE IS AN OUTSTANDING LIA BILITY AT RS.71,68,305.00 AS DISCOUNT PAYABLE TO THE CUSTO MERS ACCUMULATED FOR THE LAST FOUR YEARS. OUT OF THAT AM OUNT THE APPELLANT HAS CLAIMED EXPENSES ON ACCOUNT OF DISCOU NTS TO CUSTOMERS AT RS.12,06,800.00 IN THE PRESENT PERIOD [AY ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 2 2009-10]. THE LD. AO IN THE PRESENT CASE HAS ADDED THAT AMOUNT RS.71,68,305.00 IN THE TOTAL INCOME OF THE APPELLANT. SUCH AN ADDITION WAS AGAINST THE FAC TS ON RECORD AS WELL AS LAW ON THE SUBJECT. II) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE PRESENT CASE THE LD.CIT[A] HAS GROSSLY ERRED TO HOL D THAT THE AMOUNT OF RS.59,61,505.00 REPRESENTS PROFIT CHARGEABLE TO TAX U/S 41(1) OF THE I.T. ACT, 1961 SINCE THIS LIABILITY CEASED TO EXIST DURING THE PRESENT YEAR A ND THE AMOUNT OF RS.12,06,800=00 PERTAINING TO DISCOUNT PA YABLE DURING THE PRESENT YEAR IS ADDED BACK U/S 68 OF THE I.T. ACT, 1961. III) THAT IN THE PRESENT CASE IT IS INCORRECT TO S AY THAT THE APPELLANT HAS FAILED TO PROVE THE IDENTITY OF CUSTO MERS TO WHOM DISCOUNT IN QUESTION WAS GIVEN. THE APPELLANT SUBMITTED CONFIRMATION LETTERS PROCURED FROM CUSTOM ERS. THE LD. AO WITHOUT MAKING ANY ENQUIRY FROM SUCH CUSTOMERS ADDED THE SAID AMOUNT IN THE TOTAL INCOME OF THE APPELLANT. IV) THAT THE LD. AO IN HIS REMAND REPORT HAS SAID THAT HE WROTE LETTERS TO 15 CUSTOMERS TO WHOM THE SAID DISC OUNT OF RS.12,06,800.OO WAS ALLOWED / PAYABLE IN THE PRESEN T PERIOD, BUT HE RECEIVED ONLY ONE REPLY, WHICH READS 'THE BOOKING OF THE FLAT WAS MADE AT RS.2300.00 LESS RS. 50.00 I. E. RS.250.00 PER SQ:FT. WE WERE NOT GIVEN ANY DI SCOUNT OTHER THAN WHAT HAS BEEN STATED ABOVE'. THIS REPLY BY THE CUSTOMER CLEARLY CONFIRMS THAT THE SAID CUSTOMER WA S ALLOWED DISCOUNT @ RS.50.OO PER SQ. FT. BY THE APPE LLANT ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 3 HEREIN. ON SUCH CONFIRMATION IT CAN BE WELL CONCLUD ED THAT THE STAND OF THE APPELLANT WAS / IS CORRECT. BUT TH E LD. LOWER AUTHORITIES HAVE MISREAD THAT REPLY AGAINST T HE APPELLANT. V) THAT WHEN THE APPELLANT FILED FULL DETAILS OF C USTOMERS TO WHOM DISCOUNT WAS PAYABLE, THE LD.AO WAS REQUIRE D TO MAKE ENQUIRY FROM SUCH CUSTOMERS INCLUDING SUMMONIN G OF SUCH CUSTOMERS. THE LD. AO EVEN AT APPEAL STAGE MAD E ENQUIRY PART HEARTEDLY, SO TRUTH COULD NOT BE BROUG HT ON RECORD. VI) THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, REVISE, MODIFY, SUBSTITUTE OR DELETE ANY OR ALL GROUNDS OF APPEAL OR/AND PRAYER MADE. PRAYER IN VIEW OF THE ABOVE, IT IS, THEREFORE, PRAYED THAT THE IMPUGNED ORDER BEING ILLEGAL, ARBITRARY, BEYOND JUR ISDICTION AND IN UTTER DISREGARDS OF THE TRUE FACTS AND IN TH E CIRCUMSTANCES OF THE CASE MAY KINDLY BE QUASHED IN THE INTEREST OF JUSTICE AND FAIR PLAY. 2. BRIEF FACTS OF THE CASE ARE AS UNDER: ASSESSEE FILED ITS RETURN OF INCOME ON 30/09/09 DEC LARING TOTAL INCOME OF RS.22,14,360/-. THE CASE WAS SELECTED FOR SCRUTINY AND STATUTORY NOTICE UNDER SECTION 143(2) OF THE ACT WA S ISSUED, ALONG WITH NOTICE UNDER SECTION 142(1) AND QUESTIONNAIRE. IN RESPONSE TO STATUTORY NOTICES, REPRESENTATIVE OF ASSESSEE AP PEARED BEFORE LD.AO AND FILED REQUISITE DETAILS AS CALLED FOR. ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 4 3. LD.AO OBSERVED THAT ASSESSEE WAS ON THE BASIS OF PROPERTY DEALER DURING FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION. 4. LD.AO RECORDED THAT SEVERAL OPPORTUNITIES WAS GI VEN TO ASSESSEE TO PROVE GENUINENESS OF DISCOUNT PAID/PAYA BLE TO CUSTOMERS. HOWEVER, ASSESSEE FILED ONLY COPY OF LE DGER ACCOUNT OF DISCOUNT TO CUSTOMERS, WHICH WAS NOT SUFFICIENT TO PROVE GENUINENESS OF DISCOUNT PAID/PAYABLE AND IDENTITY O F SUCH CUSTOMERS. LD.AO, THUS, WAS OF OPINION THAT ASSESSE E HAS NOT PROVED THREE INGREDIENTS, WHICH IS REQUIRED TO BE E STABLISHED BY ASSESSEE UNDER SECTION 68 OF THE ACT, BEING, IDENTI TY, CREDITWORTHINESS AND MOST IMPORTANTLY, GENUINENESS OF TRANSACTION. HE, ACCORDINGLY, DISALLOWED SUM OF RS. 71,68,305/-. 5. AGGRIEVED BY ASSESSMENT ORDER PASSED, ASSESSEE P REFERRED APPEAL BEFORE LD.CIT (A). BEFORE LD. CIT(A), ASSESS EE FILED ADDITIONAL EVIDENCE, WHICH WAS REMANDED TO LD.AO. L D.AO AFTER CONSIDERING ADDITIONAL EVIDENCE ISSUED REMAND REPOR T DATED 09/02/15 STATING THAT CIRCUMSTANCES WHICH PRECLUDED ASSESSEE FROM FILING EVIDENCE BEFORE ASSESSMENT ORDER DOES N OT STAND SATISFIED AS PER RULE 46A. HE, THUS, REJECTED ADDIT IONAL EVIDENCE FILED BY ASSESSEE. 6. LD.CIT(A) AFTER CONSIDERING SUBMISSIONS ADVANCED BY ASSESSEE, DISMISSED APPEAL FILED BY ASSESSEE. 7. AGGRIEVED BY ORDER OF LD. CIT (A) ASSESSEE IS IN APPEAL BEFORE US NOW. 8. AT THE OUTSET, LD.AR SUBMITTED THAT GROUND NOS. (I), (IV) ARE NOT PRESSED. ACCORDINGLY, WE DISMISS THESE GROU NDS AS NOT PRESSED. ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 5 9. AS REGARDS GROUND NOS. (III), (V) TO (VI) ARE CONCERNED IS GENERAL IN NATURE AND, THEREFORE, DO NOT REQUIRE AN Y ADJUDICATION. 10. GROUND NO. (II) HAS BEEN RAISED IN RESPECT OF SUM OF RS.59,61,505/- WHICH HAS BEEN CONSIDERED BY AUTHORI TIES BELOW AS CEASED UNDER SECTION 41(1) OF THE ACT AND HOLDIN G ALLEGED DISCOUNT PAID DURING YEAR AMOUNTING TO RS.12,06,800 /- UNDER SECTION 68 OF THE ACT. 11. LD.AR SUBMITTED THAT ASSESSING OFFICER MADE ADD ITION OF RS.71,68,605/-ON ACCOUNT OF DISCOUNT PAYABLE TO CUS TOMERS. HE SUBMITTED THAT A SUM OF RS.12,06,800/-, OUT OF TOTA L DISCOUNT PAYABLE, PERTAINED TO YEAR UNDER CONSIDERATION. HE SUBMITTED THAT, ASSESSING OFFICER, WITHOUT GIVING PROPER OPPO RTUNITY, MADE ADDITION OF ENTIRE AMOUNT. LD. AR SUBMITTED THAT BA LANCE AMOUNT OF RS.59,61,505/-, RELATED TO PRECEDING YEARS. HE S UBMITTED THAT DURING REMAND PROCEEDINGS, ASSESSEE SUBMITTED CONFI RMATION FILED BY CUSTOMERS TOWARDS DISCOUNT ALLOWED BY ASSE SSEE DURING YEAR UNDER CONSIDERATION, AND ALSO LIST OF CUSTOMER S PERTAINING TO EARLIER YEARS. BUT LD.AO HELD AMOUNT TO BE NON-GENU INE. 12. ON THE CONTRARY, LD. SR. DR SUBMITTED THAT ASSE SSING OFFICER WAS RIGHT IN HOLDING DISCOUNT PAYMENT OF RS .12,06,800/- TO BE NON-GENUINE, AS ASSESSEE COULD NOT ESTABLISH GENUINENESS OF TRANSACTION, BY PRESENTING CUSTOMERS, ALONG WITH THEIR PAN CARD, TO WHOM DISCOUNT WAS GIVEN. HE SUBMITTED THAT , AS TRANSACTION COULD NOT BE VERIFIED BY LD. AO, HE HAS RIGHTLY MADE ADDITION OF SECTION 68 OF THE ACT. 13. AS REGARDING BALANCE RS.59,61,505/-, LD. SR. DR SUBMITTED THAT ASSESSEE FAILED TO GIVE SUBSTANTIAL EVIDENCE O F PENDING LIABILITY TO THAT EXTENT. ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 6 14. WE HAVE PERUSED SUBMISSIONS ADVANCED BY BOTH SI DES IN LIGHT OF RECORDS PLACED BEFORE US. 15. THE CASE OF ASSESSEE IS THAT, IT HAD SHOWN A SU M OF RS.71,68,305/-, ON ACCOUNT OF DISCOUNT PAYABLE IN H IS BALANCE SHEET AS ON 31/03/09. LD.AO DURING ASSESSMENT PROCE EDINGS CALLED FOR DETAILS OF PARTIES TO WHOM DISCOUNTS WER E PAYABLE FOR PURPOSES OF VERIFYING GENUINENESS OF TRANSACTION. A SSESSEE FILED SOME DETAILS AS ADDITIONAL EVIDENCE AT THE TIME OF HEARING BEFORE LD.CIT (A), WHICH WAS SENT FOR REMAND TO LD.AO. LD. AO OBSERVED THAT ASSESSEE HAD FILED CONFIRMATION OF PERSONS TO WHOM DISCOUNTS WERE PAID DURING THE YEAR UNDER CONSIDERA TION AMOUNTING TO RS.12,06,800/-. IN RESPECT OF BALANCE AMOUNT OF RS.59,61,505/-, IT HAS BEEN SUBMITTED THAT THE AMOU NT PERTAINS TO PRECEDING YEARS, ASSESSEE FILED LIST OF NAMES TO WHOM DISCOUNTS WERE ALLEGED TO BE PAYABLE. 16. LD. AO, THEREAFTER, GETTING COMPLETE ADDRESS OF PERSONS TO WHOM DISCOUNT WAS PAYABLE DURING YEAR UNDER CONSIDE RATION SENT LETTERS TO 15 PERSONS ASKING THEM TO CONFIRM D ISCOUNT PAYABLE BY ASSESSEE. IF IS OBSERVED THAT OUT OF 15 LETTERS TWO LETTERS CAME BACK UNSERVED, WHEREAS IN BALANCE 13 C ASES REPLY WAS RECEIVED ON ONE CASE. PERSON WHO SUBMITTED REPL Y TO LD.AO, STATED THAT NO DISCOUNT WAS GIVEN BY APPELLANT IN C ONNECTION WITH BOOKING OF FLAT. THUS, ON ANY INDEPENDENT ENQUIRY C ONDUCTED BY LD.AO ON THE BASIS OF DETAILS SUBMITTED BY ASSESSEE NOT A SINGLE CUSTOMER ACKNOWLEDGED TO DISCOUNT HAVING RECEIVED F ROM ASSESSEE. ASSESSEE ALSO COULD NOT PRODUCE THESE PER SONS WHO WERE CLAIMED TO HAVE RECEIVED DISCOUNT FROM ASSESSE E. ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 7 17. WE HAVE CAREFULLY CONSIDERED ARGUMENT ADVANCED BY LD.AR AND ARE NOT IMPRESSED WITH THAT. IN OUR OPINION ASS ESSEE HAS FAILED TO DISCHARGE INITIAL ONUS CAST UPON ASSESSEE TO IDENTIFY CREDITORS AND ALSO PROVE CREDITWORTHINESS AND GENUI NENESS OF TRANSACTION IN FACTS OF PRESENT CASE. ASSESSEE IN P APER BOOK HAS ONLY FILED BALANCE SHEET LEDGER ACCOUNTS AND INTIMA TION ISSUED UNDER SECTION 143 (1) OF THE ACT, PERTAINING TO ASS ESSEE. NONE OF THESE DOCUMENTS SHOW ANY DETAILS OF CUSTOMERS, IN O RDER TO SHIFT ONUS UPON REVENUE. FURTHER LD. AO HAS INVESTIGATED UPON WHATEVER DETAILS WERE SUBMITTED BY ASSESSEE, BY ISS UING NOTICE UNDER SECTION 131 OF THE ACT, AND HAS FOUND TO BE C ONTRARY TO WHAT HAS BEEN SUBMITTED BY ASSESSEE IS. 18. WE DRAW OUR SUPPORT FROM THE STRICT ANALYSIS OF SECTION 68 BY HONBLE DELHI HIGH COURT IN CASE OF CIT VS. LOVELY EXPORTS REPORTED IN [2008] 216 CTR 195 (SUPRA) . HONBLE COURT HAS HELD AS UNDER: 18. IN THIS ANALYSIS, A DISTILLATION OF THE PROCEE DINGS YIELD THE FOLLOWING PREPOSITIONS OF LAW IN THE CONTEXT OF SECTION 68 OF THE INCOME TAX ACT. THE ASSESSEE HAS TO PRIMA FA CIE PROVE (1) THE IDENTITY OF THE CREDITOR/SUBSCRIBER; (2) THE GENUINENESS OF THE TRANSACTION, NAMELY WHETHER IT H AS BEEN TRANSMITTED THROUGH BANKING CHANNEL OR OTHER INDISPUTABLE CHANNELS; (3) THE CREDITWORTHINESS OR FINANCIAL STRENGTH OF THE CREDITOR/SUBSCRIBER; (4) IF RELEVAN T DETAILS OF THE ADDRESS OR PAN IDENTITY OF THE CREDITOR/SUBSCRI BER ARE FURNISHED TO THE DEPARTMENT ALONG WITH COPIES OF TH E SHAREHOLDERS REGISTERED, SHARE APPLICATION FORMS SH OULD, SHARE TRANSFER REGISTER, ETC., IT WOULD CONSTITUTE ACCEPTABLE ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 8 PROOF OR ACCEPTABLE EXPLANATION BY THE ASSESSEE. (5 ) THE DEPARTMENT WOULD NOT BE JUSTIFIED IN DRAWING AN ADV ERSE INFERENCE ONLY BECAUSE THE CREDITOR/SUBSCRIBER FAIL ED TO NEGLECT TO RESPOND TO BLITZ NOTICES; (6) THE ONUS W OULD NOT STAND DISCHARGE IF THE CREDITOR/SUBSCRIBER DENIES T O REPUDIATE THE TRANSACTION SET UP BY THE ASSESSEE NO R SHOULD THE ASSESSING OFFICER TAKE SUCH REPUDIATION AT FACE VALUE TO CONSTRUE IT, WITHOUT MORE AGAINST THE ASSE SSEE; AND (7) ASSESSING OFFICER IS DUTY BOUND TO INVESTIG ATE THE CREDITWORTHINESS OF THE CREDITOR/SUBSCRIBER TO THE GENUINENESS OF THE TRANSACTION AND THE VERACITY OF THE REPUDIATION. 19. IT IS ALSO OBSERVED THAT ASSESSEE IN THE CASE OF CIT VS. LOVELY EXPORTS (SUPRA) HAD ESTABLISHED BY WAY OF CONFIRMATION AND AFFIDAVITS OF SHARE APPLICANTS, CONTAINING DETAILS INCLUDING PAN/IT WARD NUMBER, RATION CARD OF SHARE APPLICANTS , AND FURTHER PAYMENTS WERE MADE THROUGH PROPER BANKING C HANNELS. IN THAT PARTICULAR CASE ALL THE NECESSARY DETAILS, PARTICULARS OF THE CREDITORS WERE FURNISHED THEREBY DISCHARGING THE ON US. 20. THE DECISIONS RELIED UPON BY LD.AR BEING DECISI ON OF HONBLE DELHI HIGH COURT IN CASE OF CIT VS GANGESHWARI METAL PVT. LTD. , REPORTED IN (2014) 361 ITR 10 , HONBLE PUNJAB AND HARYANA HIGH COURT IN CASE OF CIT VS. VARINDER RAWLLY REPORTED IN (2014) 366 ITR 232 , DECISION OF HONBLE RAJASTHAN HIGH COURT-JAIPUR BENCH , REPORTED IN (2014) 366 ITR 217 ARE DISTINGUISHABLE ON FACTS, AS IN ALL THESE CASES, ASSESSEE THEREIN PROV IDED MOST OF THE DETAILS REGARDING PARTIES LIKE PAN NUMBERS, CONFIRM ATION LETTERS, COMPLETE ADDRESS PROOF, COPIES OF BANK STATEMENT OF THE PARTIES, ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 9 COPIES OF BANK ACCOUNT OF ASSESSEE THEREIN, WHICH W AS SUFFICIENT IN ORDER TO DISCHARGE INITIAL ONUS CAST UPON ASSESS EE THEREIN UNDER SECTION 68 OF THE ACT. 21. FURTHER, IT IS HARD TO BELIEVE THAT WHEN ASSESS EE IS DEALING IN PURCHASE AND SALE OF PROPERTIES, MOST OF THE DOC UMENTS LIKE PAN CARD RATION CARD AND ADDRESS PROOF OF PARTIES/C USTOMERS WHO ARE PURCHASERS/CUSTOMERS OF FLATS THROUGH ASSES SEE. ACCORDINGLY, WE CONFIRM THE DISALLOWANCE OF EXPENSE S ON ACCOUNT OF ALLEGED DISCOUNTS AMOUNTING TO RS. 12,06,800/-. 22. IN OUR CONSIDERED OPINION ASSESSEE FAILED TO ES TABLISH IDENTITY, CREDITWORTHINESS AND MOST IMPORTANTLY GEN UINENESS OF DISCOUNTS CLAIMED TO HAVE BEEN PAID/PAYABLE BY ASSE SSEE TO SATISFACTION OF LD.AO, AS LAID DOWN BY HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS LOVELY EXPORTS (SUPRA) . 23. AS REGARDS BALANCE AMOUNT OF RS.59,61,505/-, TH AT HAS BEEN ALLEGED TO BE PERTAINING TO PRECEDING YEARS, A SSESSEE ONLY FILED LIST OF PERSON AND LEDGER ACCOUNT WITHOUT GIV ING THEIR PAN DETAILS AND/OR CONFIRMATIONS. IT HAS BEEN OBSERVED BY AUTHORITIES BELOW THAT EVEN DURING FIRST APPELLATE PROCEEDINGS, ASSESSEE COULD NOT FILE THESE DETAILS IN ORDER TO ESTABLISH THAT L IABILITY EXISTED. FURTHER, IT HAS BEEN ALLEGED THAT LIABILITY HAS NOT BEEN PROVED TO BE EXISTING. 24. ON THE CONTRARY, LD.AR SUBMITTED THAT NO ADDITI ON CAN BE MADE UNDER SECTION 41(1) OF THE ACT UNLESS THERE AR E MATERIALS AVAILABLE ON RECORD TO SHOW THAT LIABILITY CEASED T O EXIST. HE PLACED RELIANCE UPON DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. SUGAULI SUGAR WORKS PVT. LTD., REPORTED IN (1999) 236 ITR 518. ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 10 25. ASSESSEE IN PAPER BOOK FROM PAGE 98-155 PLACED BALANCE SHEET, INCOME AND EXPENDITURE ACCOUNT AND INTIMATION PROCE SSED UNDER SECTION 143(1) OF THE ACT FROM ASSESSMENT YEAR 2010-11 ONWA RDS. ON PERUSAL OF THE SAME, IT APPEARS THAT EVERY YEAR IN BALANCE SHEET E XPENSES PAYABLE IN RESPECT OF DISCOUNT TO CUSTOMERS HAVE BEEN SHOWN HA VING AN INCREASING TREND. DURING YEAR ENDING 31/03/12 EXPENSES PAYABLE HAS BEEN SHOWN AT RS.71,11,275/-, VIS-A-VIS RS.87,77,312/-WHICH WAS SHOWN AS PAYABLE AS ON 31/03/11. IT HAS FURTHER REDUCED TO RS.69,12,405/- AS ON YEAR ENDING 31/03/13 AND RS.64, 62,575/- AS ON 31/03/14. THUS IT CANNOT BE IGNORED THAT ASSESSEE HAS BEEN MAKING PAYMENTS, AS AND WHEN CLAIM IS RAISED BY CREDITORS. THUS IN OUR CONSIDERED OPINION CONDITION S OF SECTION 41(1) DOES NOT STAND SATISFIED. HONBLE SUPREME COURT IN CIT VS. SUGAULI SUGAR WORKS PVT. LTD., (SUPRA) HELD THAT UNILATERAL ACTION CANNOT BRING OUT CESSA TION OF LIABILITY. IF AND WHEN THERE IS ANY EVIDENCE IN LAT ER YEARS TO SHOW THAT LIABILITY HAS CEASED, THEN ONLY IT CAN BE BROUGHT T O TAX UNDER PROVISIONS OF SECTION 41(1) OF THE ACT. INSOFAR AS PRESENT YEAR I S CONCERNED REVENUE HAS NOT BEEN ABLE TO ESTABLISH CESSATION OF LIABILITY. RESPECTFULLY FOLLOWING A WELL ANALYSED RATIO LAID DOWN BY HONBLE SUPREME COURT IN CASE OF CIT VS. SUGAULI SUGAR WORKS PVT. LTD., (SUPRA), WE DELETE ADDITION MADE BY LD. AO AMOUNTING TO RS.59,61,505/- UNDER SECTION 41 (1) OF THE ACT. ACCORDINGLY THIS GROUND RAISED BY ASSESSEE STANDS P ARTLY ALLOWED. IN THE RESULT APPEAL FILED BY ASSESSEE STANDS PARTL Y ALLOWED ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH NOVEMBER, 2018. SD/- SD/- (PRASHANT MAHARISHI) (BEENA A PILLAI) ACCOUNTANT MEMBER JUDI CIAL MEMBER DT. 27 TH NOVEMBER,2018 *GMV/*KAVITA ITA NO. 3881/DEL/2015 AY 2009-10 SHRI VIJAY ARORA 11 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT - TRUE COPY - BY ORDER, ASSISTANT REGISTRAR ITAT DELHI BENCHES