2009 (1) TMI 774

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.... Sriram Krishan. ORDER:- These three Appeals have been filed by the CIT(A), Delhi-XI under section 260A of the Income-tax Act, 1961 ('IT Act' for short), for the assessment years 1999-2000, 2000-01 and 2001-02. With regard to the assessee's claim for expenses for assessment year 1999-2000, 75 per cent thereof had been disallowed primarily on the ground that although the assessee was doing ex....

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....ion in June, 1998 of the lease premises could not logically lead to the conclusion that the business had been closed down and that the sale of PPQ was very much a business activity. Similarly, selling of stock could not lead to this inference. The ITAT has also noted that the expenditure in these years has substantially reduced since there was a lull in the business. Rather than a closure of busin....

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....ng in the present case. This case has been applied in CIT v. Vellore Electric Corpn. Ltd. [2000] 243 ITR 5291 (Mad.) where it has been pithily noted that maintenance and establish- ment is the indication of intention to resume business. In Karsondas Ranchhoddass v. CIT [1972] 83 ITR 1 (Bom.) it was noted that there were two periods of activity before and after the interregnum or period of inactivi....

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....firm, namely, M/s. Varma Industries, of which the assessee was also a partner; as also that the Department had allowed the expenditure in earlier years. The ITAT held that as long as assessee was carrying out her business from the said premises the expenses incurred cannot be disallowed merely because the assessee permitted Varma Industries to carry on the business from the said premises. We are i....