ITO WARD - 13(1), C.R. BUILDING vs. J L G DEVELOPERS LIMITED, JANPATH

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘C’ BENCH,
NEW DELHI

BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER, AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER

ITA No.4905/DEL/2024 [A.Y 2016-17]
Ward -13(1), Delhi

A-22, Central Delhi

New Delhi

PAN: AABCI 7706 N

(Appellant)

(Respondent)

Assessee By : Shri Tarun Kandhari, CA

Shri Hement Kumar, CA

Ms. Ayushi Mittal, CA

Department By : Shri Om Prakash, Sr. DR

Date of Hearing
: 03.12.2025
Date of Pronouncement : 12.12.2025

PER NAVEEN CHANDRA, AM :-

This appeal by the Revenue is directed against the order of the ld.
CIT(A), Delhi dated 26.09.2024 pertaining to A.Y 2016-17. 2. The solitary grievance raised by the Revenue pertains to the deletion of addition of Rs. 8,22,08,000/- made u/s 41(1) of the Income-
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tax Act, 1961 [the Act, for short] on account of cessation of liability without following the process of admitting additional evidence u/r 46A.
3. Brief facts of the case are that the assessee received an amount of Rs. 8,22,08,000/- from M/s Sethi Housing Private Limited and the amount has been utilized by the assessee for the purpose of repayment of loan of Bank of India. The same is returnable to M/s Sethi Housing
Private Limited. The assessee has not claimed this amount as trading expenses in the books of accounts in any of the preceding years.
4. The ld AO however considered the same as cessation of liability u/s 41(1) and added the same to the income of the assessee u/s 143(3) of the Act.
5. Aggrieved, the assessee went in appeal before the ld. CIT(A) who deleted the addition made by the Assessing Officer.
6. Now the aggrieved Revenue is in appeal before us.
7. The ld. counsel for the Revenue vehemently submitted that the ld.
CIT(A) was not justified in ignoring the applicability of Explanation 1 of Section 41(1)(a) of the Act as mentioned in the case of T V Sundram
Aiyangar & Sons 222 ITR 344. The ld. DR relied upon the findings of the Assessing Officer.
8. The ld DR further stated that during the course of appellate proceedings, the Assessing Officer in his remand report has mentioned
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that the assessee stands dissolved in terms of notice no.
ROC(H)/248(5)STK-7/2017 dated 21.7.2017, issued by the