Auto Kashyap India (P) Ltd. The facts of the case were more or less identical to the assessee's case. One Mr.Parmanand Kashyap father of Mr.Rajinder Kashyap was the director of the assessee company therein, who used to purchase spare parts from different parties, on credit, in his own name and an amount was payable to Mr.Parmanand Kashyap for the purchase made by him for the assessee company. The outstanding credit balance was shown in the books of accounts of the assessee company under the sub-head “other supplier” of the mainhead “sundry creditors”. Since the purchases were being handled by Mr.Parmanand Kashyap, the assessee decided to make the matter simple by transferring the credit balance to Mr.Parmanand Kashyap and consequently, the nomenclature of the outstanding balance was changed from “other suppliers” to Mr.Parmanand Kashyap in the audited financial statement of the said assessee company. The Assessing Officer was of the view that the transfer of the account of “sundry creditors” by way of book entry in the name of Mr.Parmanand Kashyap constituted cessation of liability, which is taxable under Section 41 of the Act. While, the matter was pending before the CIT(A), Mr.Parmanand Kashyap died. Consequently, the CIT(A) was of the view that the liability had ceased to exist. However, it did not say
