TaxTMI 
TaxTMI 
2013 (10) TMI 1127
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 148, as bad in law and deserves to be quashed. Before us, the counsel for the assessee has raised this issue for the first time claiming that the AO has not supplied reasons for reopening the assessment and therefore, the reassessment order is bad in law, as no reasons have been provided to the assessee till date. The Counsel relied upon the decision of the Hon'ble jurisdictional High Court in the case of CIT vs. Fomento Resorts and Hotels Ltd. Per contra, the ld. DR strongly objected to this submission of the counsel stating that the notice u/s.148 was issued asking the assessee to file the return of income, therefore, there is no occasion to supply reasons for reopening the assessment. 3. We have considered the rival submissions. We fi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t and other charges up to 31.03.2012. Since, the assessee defaulted in repayment of loan in time, the bank filed a suit before the Hon'ble Debt Recovery Tribunal, Mumbai. The bank also invoked shares pledged by the company and thereby reducing the liability by Rs.7,03,23,886/- against the original demand of Rs.16,47,21,682/-. The balance amount of Rs.10,17,91,981/- was settled by order dated 25.11.2004 passed by the DRT. The assessee has paid Rs.94,75,000/- as against the liability of Rs.1,01,791,981/- and the remaining amount of Rs.9,23,16,981/- is written off. According to the AO, the order of the DRT does not clearly specify whether the write-off amount includes a Bank Guarantee, principal or interest amount. According to the AO, the lia....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cordingly restricted the disallowance to 2,49,26,390/-. Aggrieved by this, assessee is before us. The ld. Counsel for the assessee reiterated what has been submitted before the lower authorities. The ld. DR strongly supported the order of the ld. CIT(A). 7. We have carefully perused the orders of the lower authorities. The statement of loan amount as exhibited at para 5 of the assessment order clearly shows that the assessee has transferred the waiver to its capital reserves amount totaling to Rs.9,23,16,891/-. It is not in dispute that the settlement agreement between assessee and the bank does not specify the principal amount and the interest and other charges. However, the AO has given a very categorical finding by bifurcating the princ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....For the observation of the CIT(A) that there is not business activity, the counsel for the assessee relied upon the decision of the Tribunal in the case of its group concern Classic Shares & Stock Broking Pvt. Ltd. in ITA No.5244/Mum/2011 and submitted that the assessee is also a part of Ketan Parekh group and the facts are identical. Therefore, the claim of the expenses deserve to be allowed. Per contra the ld. DR strongly supported the order of the CIT(A). 11. We have considered the rival submissions and carefully perused the order of the CIT(A) as stated hereinabove. The claim of depreciation on BSE card is straightway disallowed for the reason mentioned hereinabove. So far as the other business activity is concerned, we find force in t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed by the assessee which was dismissed by SAT much later and the order of SAT was also confirmed by the Hon'ble Supreme Court. But these were subsequent activities and in the year under consideration the business of the assessee had not closed and it was only suspended in view of the adverse order of SEBI. We find smaller situation had been considered by the tribunal in case of KNP Securities Pvt. Ltd. (supra) another concern of Ketan Parekh group in which similar claim was made by the assessee that business was in existence and not closed. The tribunal following the judgment of Hon'ble High Court of Madras in the case of CIT Vs Vellore Electrical Corporation Ltd. (243 ITR 529) held that the business had not closed and the claim of expendit....