We have studied Section 41(1) where in case bad debts etc recovered,it was deemed to be PGBP Income

Same thing applied to Income from Other Sources as per Section 59


Income from Other Sources

Amount Received in Case of Remission/Cessation of loss/expenditure/trading liability Section 41 (1)

(Bad Debts etc Recovered)

If a person has claimed any deduction for loss/expenditure/trading liability

and later

Some amount or benefit received by way of remission/cessation there of

Then that amount or benefit will be deemed to be PGBP income


Amt Received by Successor:-

It doesn’t matter if received by assessee or successor

Even if amount/benefit received by successor of business, still amount will be taxable.



Successor means

  • In case of Amalgamation:  Amalgamated Company
  • Demerger: Resulting Company
  • One firm succeeded by Seond firm: The Second firm
  • One person succeeded by Seond person: The Second Person



Section 59

The provisions of sub-section (1) of section 41 shall apply

in computing the income of an assessee under Income from Other Sources under section 56,

as they apply in computing the income of an assessee under the head "Profits and gains of business or profession".




















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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 13 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.