As far as section 41(1)(a) is refers to any amount in respect of such loss or expenditure or some benefit in respect of such trading liability by way of remission or cessation thereof, the amount obtained by such person or the value of benefit accruing to him shall be deemed to be profits and gains of business or profession and accordingly chargeable to income-tax as the income of that previous year.
Here, the Assessee is ready to pay the outstanding liability, but unfortunately the Company was closed by the ROC. Assesse was not in default for repayment of outstanding loan liability but due the closer of Company, not able to pay out liability of loans. Further Assessee has nowhere mentioned that they have claimed said outstanding liability as expenditure or loss or benefits. Hence, there was no question to make any addition for said outstanding liability in the hands of assessee. As the provisions of section 41(1) is not applicable. Further Karta and Directors is one and the same person hence, HUF can pay the said outstanding liability to company till the bank of the company is operational even if the company was closed or strike off by the ROC.

Note :

The AO cannot invoke the provision of section 41(1) based on the facts stated by the querist. The querist may refer ,CIT v. Mahindra And Mahindra Ltd. [2018] 404 ITR 1 (SC) held that for application of section 41(1), it is sine qua non that there should be an allowance or deduction claimed by assessee in respect of loss, expenditure or trading liability incurred, however, assessee had not claimed deduction under section 36(1)(iii) for interest on loan and loan was obtained for acquiring capital assets, hence, waiver was on account of liability other than trading liability and, thus, provisions of section 41(1) were inapplicable

In CIT v. Eco Auto Components Pvt. Ltd. (2018) 409 ITR 202 (P&H)(HC) held that though the debt is time barred if the assessee is showing as liability addition cannot be made u/s 41(1) of the Act .
The querist may verify though the name of the company might have been strike of by the ROC i.e. Closed, the bank account may be in operation . If the bank account is in operation the amount can be paid to the Company . If the company has gone voluntary winding up one may have verify the condition prescribed for recovery or payment . The querist can take decision accordingly. The Supreme Court in Asset reconstruction company (India) limited v. Bishal Jaiswal & Anr . www.itatonline.org (SC) (CA.no 3228 of 2020 dt 15-4 – 2021 ) has held that an entry made in the books of accounts, including the balance sheet, can amount to an acknowledgement of liability within the meaning of Section 18 of the Limitation Act. The notes annexed to or forming part of the balance sheet, or the auditor’s report, must be read along with the balance sheet. An entry made in the books of accounts, including the balance sheet, can amount to an acknowledgement of liability within the meaning of Section 18 of the Limitation Act. The notes annexed to or forming part of the balance sheet, or the auditor’s report, must be read along with the balance sheet.

Dr .K .Shivaram, Senior Advocate