Held that by issuing the notes, the assessee had raised a loan. Since the difference (between the amount due and the amount finally settled) constituted a waiver of loan, section\u00a028(iv)\u00a0of the Act would not apply as it was not a benefit or perquisite other than in the shape of-money. For section\u00a041(1)\u00a0of the Act to apply, there should have been an allowance or deduction claimed by the assessee in respect of any loss, expenditure or trading liability incurred by the assessee. Then, subsequently, if during any previous year the creditor remitted or waived any such liability, the assessee would be liable to pay tax. Section\u00a041(1)\u00a0of the Act too would thus not apply. The amount in the case at hand was a loan and not a trading liability. Section\u00a028(i)\u00a0of the Act would not apply as the assessee was not in the business of lending and borrowing but was in the business of construction, and waiver of the loan would not constitute business income of the assessee. Considering that the repayment of the loan was not allowed as a deduction in computing the assessee\u2019s income, the waiver of the loan could not be business income taxable under section\u00a028(i)\u00a0of the Act.(AY. 2014-15)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 28(i) : Business income-Value of any benefit or perquisites-Converted in to money or not-Profits chargeable to tax-Remission or cessation of trading liability-Settlement of borrowings at lower amount than due-Constitutes waiver of loan-Borrowing and lending not business of assessee-No trading liability-No benefit or perquisite other than in shape of money-Difference between amount due and amount of settlement is not taxable. [S. 28(iv), 41(1)]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-44748","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-bDK","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44748","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=44748"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44748\/revisions"}],"predecessor-version":[{"id":44749,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/44748\/revisions\/44749"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=44748"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=44748"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=44748"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}