- (1.) WE have heard Sri Shubham Agrawal, learned Counsel, for the assessee, and Sri A.N. Mahajan for the Department.
(2.) THE following three questions have been referred in this case: 1. Whether, on the facts and in the circumstances of the case, the Tribunal was legally right in holding that the sum of Rs. 9,38,575 was to be included in the total income of the assessee under Section 41(1) of the Income -tax Act, 1961? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was legally right in holding that the conduct of the assessee in crediting the liabilities to the profit and loss account showed that the liabilities of Rs. 9,38,575 had ceased to exist? Whether, on the facts and in the circumstances of the case, the Tribunal was legally right in holding that the liabilities of Rs. 9,38,575 had ceased to exist in the assessment year under reference and there was no possibility of reviving them? 3. he detailed facts have been mentioned in the statement of the case.
(3.) THE bare facts are that the amount of Rs. 9,38,575 was shifted in the profit and loss account of the assessee from the debit to the credit side. Upon this, the Assessing Officer treated the same to be the income of the assessee under Section 41(1) of the Income -tax Act, 1961, on the ground that the liability had ceased or had been remitted.;