In the balance sheet the assessee had shown huge amount of sundry creditors. The AO doubted the genuineness of creditors appearing in balance sheet and taxed the said amount u/s 41(1) of the Act. Tribunal upheld the  addition. On appeal allowing the appeal of the assessee the Court held that if existence of liabilities was doubted, same could have been disallowed in year in which it was claimed, or could have been treated as unexplained cash credit in hands of assessee under S. 68, but same could not be taxed under S. 41(1), inasmuch as if liability itself was not genuine, question of remission or cessation thereof would not arise. (AY.2010-11)