AI Drafter 
TaxTMI 
TaxTMI 
2024 (1) TMI 148
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....ssee was incorporated on 07.09.2005 to carry out business of transportation of goods and passengers by Air. Assessee filed its return of income on 31.03.2014, reporting a loss of Rs. 13,28,53,176/- on account of unabsorbed depreciation. Ld. AO completed the assessment u/s. 143(3), of the Act assessing the total income at Rs. 4,98,56,581/-. On the first issue relating to addition made towards share application money, Ld. AO noted that assessee had received an amount of Rs. 4,30,78,000/- from Shree Gopal Kumar Goyal during the year, for which assessee filed only a confirmation letter. Since bank statement was not furnished, Ld. AO added the same in the hands of the assessee. On the second issue, Ld. AO disallowed the claim of expenses by taking a view that no activity was carried out by the assessee as the operations of the assessee had been suspended in October, 2009 and there is no intention of the assessee to revive the operations. In this respect, assessee had submitted that it had claimed the expenses on the principle of 'going concern' and are, therefore, allowable. However, Ld. AO disallowed the same. 4. Before us, Ld. Counsel for the assessee has placed a paper book contai....
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..... AO on 25.03.2015 for the share applicant. 6.2. He further referred to various evidences furnished in the case of share applicant Shri Gopal Kumar Goyal which is tabulated as under: Sr. No. Name of the share applicant Amount (in Rs.) Evidence (pages of paper book) 1. Sh. Gopal Kumar Goyal Address: 436/16, Civil Lines, Gurgaon, Haryana PAN No. AEFPG8370J 4,30,78,000/- i) Copy of return of income of Sh. Gopal Kumar Goyal (376-378) ii) Copy of order of assessment of Shri Gopal Kumar Goyal for assessment year 2012- 13 where investment stands accepted (379) and income assessed at Rs. 20,24,940/- iii) Copy of audited financial statement of the appellant company (34) iv) Copy of bank statement of the appellant company (58 to 88) v) Copy of confirmation (118) vi) Copy of ledger account of Sh. Gopal Kumar Goyal in the books of appellant company for the period of 01.04.2011 to 31.03.2015 (382-388) vii) Copy of bank statement of sh. Gopal Kmar Goyal (389-391) 6.3. From the furnishing of these evidences of the share applicant, ld. Counsel asserted that all of these were before the Ld. AO, both at the time of the assessment of the assessee as wel....
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....been placed before us also, forming part of the paper book. 7.1. We have gone through the assessment order passed in the case of share applicant, Shri Gopal Kumar Goyal, perusal of the same reveals that Ld. AO has accepted the submissions and claims made by him in his return. We also take note of the fact that the share applicant has made investments, both in the preceding as well as succeeding years, details of which has already been tabulated above. Thus, it is not a sole transaction with the assessee in this year only. We do find force in the submission made by the Ld. Counsel and have no reason to interfere with the findings given by the Ld. CIT(A) in deleting the addition of Rs. 4,30,78,000/-. While holding so, we draw force from the decision of Hon'ble jurisdictional High Court of Delhi in the case of Satkar Infrastructure Pvt. Ltd. (supra). Accordingly, ground no. 1, taken by the revenue in this respect is dismissed. 8. On the second issue relating to disallowance of expenditure incurred by the assessee, Ld. Counsel for the assessee referred to the statement of P & L Account, Note No. 26 & 27 containing details of employee benefit expenses, operational expenses and adm....
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....g in various provisions is wider in scope than the expression 'for the purpose of earning income'. In view of this judgment, the opinion of the Assessing Officer that the assessee was not carrying on any business since there was no activity leading to the earning of income, becomes erroneous and unsustainable. When the assessee-company has been set up with an object of making strategic investment in the shares of companies involved in the cement business, we find that it cannot be held that the assessee is not carrying on any business. We therefore, approve the finding of the learned Commissioner of Income-tax (Appeals) to this extent." 14. Following the ratio of the above said decision, we are of the opinion that the Assessing Officer has erred in rejecting the business loss of the assessee admitted in the return of income. The Assessing Officer should have appreciated that there was business activity, though there was no revenue during the previous year under consideration. Hence, in our opinion the expenditure is relatable to the business activity and the same is allowable as a deduction. " 9. From the submissions made before us, we note that it is an undispu....
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..... Considering the submissions made by the Ld. Counsel and facts and circumstances of the case, we do not find any reason to interfere with the well reasoned findings given by the Ld. CIT(A). Accordingly, ground nos. 2 and 3 taken by the revenue in this respect are dismissed. 10. In the result, appeal of the revenue is dismissed. Order pronounced in the open court on 19.10.2023. ============= Document 1 Sr. Assessment Opening Receipt No. Year Balance during the Repayment during the Balance Closing Additon made if any Assessme Assessme nt of nt of Sh. year year (Rs.) (Rs.) appellant Gopal (Rs.) (Rs.) company Kumar u/s Goyal (Page Ws No.) (Page No.) 1 2011-12 14,53,60,000 14,53,60,000 Nil 147 147 r.w.s. r.W.S. 148 148 (392) (245) 2 2012-13 14,53,60,000 4,36,78,000 6,00,000 18,84,38,000 4,30,78,000 143(3) 143(3) (381) 3 2013-14 18,84,38,000 18,84,38,000 Nil 143(3) 143(3) (247) (395) 4 2014-15 18,84,38,000 2,60,00,000 2,24,13,000 19,20,25,000 Nil 143(3) 143(3) (249) (397- 398) 5 2015-16 19,....