AKSHAY GUJRAL ,DELHI vs. DCIT CENTRAL CIRCLE-29 , DELHI
Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’ NEW DELHI
Before: SHRI SATBEER SINGH GODARAAssessment Year: 2016-17
PER SATBEER SINGH GODARA, JM:
This assessee’s appeal ITA no. 7617/Del/2025 for assessment year
2016-17 arises against CIT(A)-30, New Delhi’s order dated 14.10.2025 (DIN:
ITBA/APL/M/2025-26/1081749296(1), in proceedings u/s 153C/143(3) of the Income-tax Act, 1961, hereinafter referred to as the ‘Act’.
Heard both the parties. Case file perused.
2. It emerges during the course of hearing that both the lower authorities have added the amount in question of Rs. 10 lakhs in the assessee’s hands as cessation
2
of liability u/s 41(1) of the Act; in assessment order dated 30.03.2023 as upheld in the lower appellate discussion.
3. Faced with this situation, the Revenue could hardly dispute the clinching fact emanating from the case records that the learned Assessing Officer’s relevant observation in para 3 at page 7 of the assessment order has nowhere made it clear that the amount in issue had ceased to exist as a liability as per the assessee’s books of account in the relevant previous year held as mandatory in CIT v. Sugauli
Sugar Works (P) Ltd. (1999) 236 ITR 518 (SC). I accordingly hold that impugned section 41(1) cessation of liability as not sustainable in law.
4. This assessee’s appeal ITA No. 7617/Del/2025 is allowed.
Order pronounced in open court on 24.12.2025. (SATBEER SINGH GODARA)
JUDICIAL MEMBER
Dated: 29.12.2025. *MP*