1984 (10) TMI 63

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.... the year under appeal was 18th Aug. 1979 to 30th Sept. 1980. Its business as per its Memorandum and Articles of Association was to manufacture and sale of steel tubes. This business could no be started in the year under appeal as its factory was still under construction. The assessee, therefore, deposited its funds received as share capital with the firm of M/s Shining Star Co. in which its Manag....

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....is not in appeal before me. The first contention of the ld. counsel for the assessee was that since the commencement certificate had been granted to the assessee, it could be said that the business had been commenced. In this connection, he invited my attention to cl. (20) of the Memorandum and Articles of Association, which reads as under: "Subject to the provisions of the law for the time bei....

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....ey by the assessee and earning of interest amounts to carrying on any business. It is settled law that the provisions of Memorandum and Articles of Association are no conclusive against or in favour of the company, for the question is not what business the taxpayer proposes to carry on but what business he actually carries on and that every case must be determined on its own facts. There an elabor....

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....re incurred for retaining the status of a company, namely miscellaneous expenses, salary, legal expenses, travelling expenses etc., would be expenditure incurred wholly and exclusively for the purpose of making or earning income. If I apply this principle to the case of the assessee, it will be seen that the assessee is entitled to practically all the expenses except the preliminary expenses of Rs....