TaxTMI 
TaxTMI 
TaxTMI 
2019 (6) TMI 541
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.... made u/s 36(1)(va) on account of delay payment of contributions received from the employees towards PF/ESIC ignoring the fact that these payments are not covered by the provision of section 43B of the I.T. Act, 1961- Gujarat State Road Transport Corporation (204-lTMI502- Guj HC). 4. "The appellant prays that the order of CIT (A) on the above ground be set aside and that of Assessing Officer be restored." Apropos issue relating to deletion of disallowance of business loss : 3. Brief facts on this issue are that the assessee is in hospitality business. To promote its hospitality business the assessee-company and M/s. Casinos Austria International, Vienna formed a subsidiary company named M/s. Advani Pleasure Cruise Pvt. Ltd. Initially due to running of casino by this subsidiary company, assessee's business of hospitality in initial stage got substantially boosted. However, subsequently since Goa Government gave such license to number of other concerns business of subsidiary declined and suffered huge loss. During this period assessee-company had given significant amount as loan and advance to its subsidiary company to pay off expenses/liabilities incurred by the subsidiary comp....
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.... the name of the appellant, Advani Hotels & Resorts (India) ltd. VIII. A perusal of financials of the appellant from 2001-02 to 2010-11 reveals that AHRIL was providing food catering and hotel services to the JVC and also discharging primary obligation such as lease rent of the casino ship, licence fee for the casino, lease rent for the jetty etc. The appellant was regularly getting reimbursed for these expenses and also received dividends of Rs. 2.78 crores. The appellant thus got total reimbursements/dividend of Rs. 48.16 crores recovered from APCCP during this period. 5.1.7 All the above undisputed facts indicate that the appellant had wanted to expand its business opportunity by venturing into a new and unique hospitality/entertainment segment of live-gaming provided by license from Government of Goa. This is evident from the fact that both the live-gaming license as well as cruise ship charter was taken in the name of the appellant. It was only to use the casino related international expertise of CAN that the appellant created a special purpose vehicle in form of JVC, APCCP. Further, the fact that the appellant was using its existing hospitality infrastructure/hotel resour....
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....the specialised business of cruise ship/live gaming casino. The facts and circumstances indicate that this was an instance where the appellant tried to add a new dimensional to its business by providing a new and novel form of life-gaming experience to its guests in addition to other entertainment and catering services. It was only because of the conditionalities of laws of Government of Goa that the appellant had to lease a cruise ship and also involved special expertise of an internationally reputed casino management company. Clearly, this effort was done to reap benefits of providing a special form of entertainment and thus making the existing resort create a USP for increased guest traffic. 5.1.10 The nature of expenditure incurred by the appellant, part of which remained not-reimbursed from its subsidiary's seen from the follows: Particulars Amount Licence fee paid and part financed by AHRIL 7,34,23,287 Other expenses (like interest and other items funded) 1,74,85,437 TOTAL 9,09,08,724 Less: Amount received during F.Y. 2010-1 1 (including Rs. 6.18 crores) (net of expenses incurred during 2010-11) 6,55,92,777 Balance amount due from the subsidiary not reco....
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....s allowable business expense for the holding company. I also find that the ratio of various decisions including those of jurisdictional High Court and honourable Supreme Court cited by the appellant in this regard apply with full force to the facts and circumstances of the case. 5.1.13 In view of the above discussion, I do not find merit in the action of the assessing officer in disallowance of business loss of Rs. 2,53,15,947/- and therefore the same is deleted. This ground of appeal is allowed. 5. Against the above order Revenue is in appeal before us. We have heard both the counsel and perused the records. Upon careful consideration we note that learned CIT(A) has found that advance was very much in line of the assessee's business. He also found due nexus between advances given to the subsidiary and assessee's business. He found that these advances to the subsidiary cannot be treated as advances which could derive benefit of enduring nature. Learned CIT(A) placed reliance upon several case laws for the proposition that advances to the subsidiary in line of assessee's business and non-recovery thereof should be allowed as business loss. Hence, learned CIT(A) deleted the advanc....