TaxTMI 
TaxTMI 
2020 (4) TMI 323
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....; for short]. 3. As can be seen from the quantum involved in the Revenue's appeal, the appeal has to be dismissed in the light of the CBDT Circular No. 17/2019 dated 08.08.2019. 4. The ld. DR vehemently stated that this Circular in not applicable to the existing appeals as it is prospective in nature. 5. In our considered opinion, the language of the Circular 17/2019 dated 08.08.2019 clearly shows that it has referred to the earlier Circular 3/2018 and its amendment dated 20.08.2018 vide which monetary limit for filing of Income tax appeals by the department before the ITAT, Hon'ble High Court, SLP/and appeals before the Hon'ble Supreme Court have been specified. It would be pertinent to refer to the Circular No. 17/2019 which reads as under: "Circular No. 17/2019 New Delhi. 8th August 2019 Subject: - Further Enhancement of Monetary limits for filing of appeals by the Department before Income Tax Appellate Tribunal, High Courts and SLPs/appeals before Supreme Court - Amendment to Circular 3 of 2018 - Measures for reducing litigation.- Reference is invited to the Circular No.3 of2018 dated 11.07.2018 (the Circular) of Central Board of Direct ....
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.... 6. This issues under section 268A of the Income-tax Act, 1961. 7. Hindi version will follow. " 6. As mentioned elsewhere by Circular 17/2019, the CBDT has further enhanced the monetary limit for filing of appeals and the same is amendment to Circular 3/2018. We find that Clause 13 of Circular 3/2018 reads as under: "The Circular will apply to SLPs/appeals/cross objections /references to be filed henceforth in Hon'ble Supreme Court/Tribunal and it shall also apply retrospectively to pending SLPs/appeals/cross objections/ references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/not pressed." 7. In light of the above, we are of the considered opinion that Circular No. 17/2019 shall also apply retrospectively to pending appeals. In that view of the matter, the appeal filed by the Revenue stands dismissed. 8. As a result, the appeal of the Revenue stands dismissed. ITA No. 2283/DEL/2016 [Assessee's appeal] 9. The solitary grievance of the assessee is that the CIT(A) erred in confirming disallowance of business expenses of Rs. 16,16,065/- made by the Assessing Officer u/s 24(b) of the Income-tax Ac....
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....elow and with the assistance of the ld. counsel for the assessee, we have considered the relevant documentary evidence brought on record in the form of paper book. 8. The bifurcation of expenses claimed by the assessee as exhibited at page 40 of the paper book is as under: Expense Head Amount Professional & Legal Charges ** 1,549,885 General Expenses ## 66,181 Total Expenses 1,616,066 Prof & Legal Fees - Party Name Details Total (Rs) Aneja & Co. Income Tax 15,25,000 Parikh & Associates Company Law 13,236 Parikh Parekh & Associates Company Law Matters 5,037 Subramanian Srinivasan & Associates Company Law matters 6,612 Grand Total 1 5,49,885 9. In our considered opinion, a body corporate has to incur certain expenditure mandatory to maintain its corporate structure. A perusal of the expenses mentioned hereinabove clearly show that all the expenses have been incurred for maintaining corporate structure of the assessee. In our considered view, such expenditure has to be allowed while computing the income of the assessee. Our this view is fortified by the decision of the co-ordinate benc....
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....ivity during the relevant previous year. It is also pointed out that reasonableness of expenditure also has no bearing on this issue. It is further pointed out that the reasoning of the CIT(A) is vague and lacks specific and cogent reasons, germane to the context, for deleting the disallowance of expenses. Learned Departmental Representative relies upon Tribunals' order in the case of Adasoft (India) (P) Ltd. v. Dy. CTT (2006) 9 SOT 31 (Del) in support of the disallowance of expenditure when business is not in existence. She relies upon the order of the AO, justifies the same, and urges us to restore the order of the AO. Dr. Gupta, learned Counsel for the assessee, supports and justifies the order of the CIT(A). Dr. Gupta submits that the assessee is a company and the expenditure incurred by the assessee are minimal expenditure just to keep the company afloat. It is submitted that the assessee was not carrying out business activity due to adverse market conditions, but the assessee being an artificial juridical person, has to incur expenditure for maintaining its existence and for carrying out whatever little activities that the assessee is involved in. Our attention i....