Any promissory note promising to pay an amount to a director of the company cannot be deemed to be an amount payable to the company and an addition made considering the same as undisclosed income of company is unsustainable, as held by KolHC in Status Home and Enclaves (P) Ltd v CIT, West Bengal IV — In favour of: Others.
The matter was remanded to the AO to consider afresh the case of the assessee after considering the development agreement under which the promissory note found during the search was given to the assessee.
Decided on: 12 August 2011.
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