Chandurkar, J.:— In J.K Chemicals Ltd. v. Commissioner Of Income-Tax, Bombay City Ii., [1966] 62 ITR 34 (Bom), while considering the provisions of s. 10(2A) of the Indian I.T Act, 1922, the corresponding provision of which is s. 41(1) of the I.T Act, 1961, the Division Bench of this court has clearly taken the view that the benefit contemplated by s. 10(2A) must be by way of “remission or cessation of liability” and no other benefit is contemplated. The Division Bench has also taken the view in that case that the transfer of an entry is an unilateral act and does not bring about the cessation of the liability of the debtor.
2. In view of this clear pronouncement of law by the Division Bench which is equally attracted in a case governed by s. 41(1), the Tribunal was clearly right when it held that appropriation of an amount of Rs. 34,004 by reversal of the entry in the profit and loss account for the year ending March 31, 1975, for which amount earlier a deduction was made in the assessment year 1973-74 as provision for gratuity, could not be treated as tantamount to a benefit as contemplated by s. 41(1) of the I.T Act, 1961. As the legal position stands today, this view was obviously correct and the question sought to be raised on behalf of the revenue is not required to be referred as the matter is concluded by the decision of this court. Rule discharged with costs.