2008 (3) TMI 90

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....gust, 1995 and as such this was the first year for which the Assessee had filed its return declaring a loss at Rs.3,01,78,033/- on 29^th November, 1996. 3. On 15^th August, 1995, the Assessee had acquired license from ESPN Inc to sub-license for distribution of ESPN Programming Services in India via Cable Television System, Satellite Master Antenna Systems and Direct to Home via Satellite. By virtue of this license, the Assessee entered into an agreement on 1^st October, 1995 with M/s. Modi Entertainment Network (P) Limited (MEN) and appointed MEN as its sole distributor for distribution of ESPN Programmes to cable operators, hotels and other DTH subscribers. 4. It was noticed by the Assessing Officer during the course of assessment p....

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.... order passed by the CIT(A), the Revenue preferred an appeal before the Tribunal. The Tribunal vide its impugned order dated 8^th September, 2006 passed in ITA No.463/Del/02 relevant for the assessment year 1997-1998 dismissed the appeal holding that the assessee has commenced the business on 15^th August, 1995. 8. Aggrieved by the order of the Tribunal, the Revenue has filed the present appeal. 9. It has been contended by learned counsel for the Revenue that though the Assessee had obtained the license on 15^th August, 1995, however, it had appointed MEN as sole distributor only on 1^st October, 1995. Moreover, no business activity of revenue nature was carried out by the Assessee during the year. It is also contended that most of th....

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....d as soon as an essential activity of that business is started.  Thus, a business commenced with first purchase of stock in trade, the date when the first sale is made is not material in that respect. Similarly, a manufacturer has to undertake several activities in order to bring to produce financial goods and he commences his business as soon as he undertakes first of such activities (Commissioner of Income Tax vs. Saurashtra Cement and Chemical Industries Ltd. 1973 (91) ITR 170 Gujrat). 13. It is also well-settled that business is nothing more than a continuous course of activities and for commencement of business all the activities which go to make up the business need not be started simultaneously.  As soon as an activity w....