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TMI Blog2012 (10) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... ate authority refused to entertain them. Considering the assessment order being non speaking and non grant of sufficient opportunity of hearing demonstrated by the assessee in the adjournment application, it is held that end of justice would be met if issues are set aside to the file of CIT(A) for re-adjudication. - I.T.A. No.1714/Del/2012 - - - Dated:- 27-7-2012 - SHRI RAJPAL YADAV AND T.S. KAPOOR, JJ. Appellant by : Shri Savrabh Goel, C.A Respondent by : Shri Pradeep Kumar, CIT-DR. ORDER PER TS KAPOOR, AM: This is an appeal filed by the assessee against the order of Ld CIT(A) dated 6.1.2012. The grounds raised by the assessee are as under:- 1. That under the facts and circumstances, no proper reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing income of Rs..11,09,870/- was filed. The case of the assessee was selected for scrutiny. During assessment proceedings, the Assessing Officer noted that assessee had claimed business expenses amounting to Rs..12,14,379/-. The Assessing Officer further noted that during the relevant previous year there was no business activity carried out during the year. Therefore, vide order sheet entry dated 29.11.2010, the Assessing Officer issued a show cause asking as to why all business expenses should not be disallowed. The written reply filed by the assessee was not considered by the Assessing Officer and he made a total addition of Rs..12,14,379/-. The Assessing Officer further noted that the assessee had claimed an amount of Rs..20,72,611/- as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said that business was lull during the year. Reliance was placed in the judgments of Emdee Exports 23 TTJ (Bang.) 63, CIT v. Anita Jain 214 Taxation 180 (Del.), CIT v. Vellore Electric Corporation Ltd. 243 ITR 529 (Mad.) wherein it was held that merely because there was lull in activity, it cannot be said that business has ceased to exist. It was also held that where assessee is maintaining office, retaining staff for export business, though export sales substantially gone down, it was held that it was a dormancy of business activity and not closure of business. The assessee further submitted that the expenses claimed were the minimum required to maintain the corporate entity and the expenses were fully vouched and were incurred for wholly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. and the amount was paid as share application money. Therefore, interest on this amount should also be allowed as business expenditure of the assessee. 4. The Ld CIT(A) did not accept the contentionS of assessee and held that appellant had suspended the business activity and it is also not the case of the company that it was engaged in liquidating its assets and collecting its outstanding dues. Therefore, in view of the above, the Ld CIT(A) allowed an expenditure of Rs.. 1 lakh only and upheld the addition in respect of remaining amount. 5. As regards second addition of Rs..20,72,611/-, the Ld CIT(A) observed from the statement of account of SBI, that there was no entry showing withdrawal of Rs..33,30,613/- for repayment of housing l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e whereby Assessing Officer has made an addition of Rs..12,14,379/- as under:- Disallowance of all business expenses: During the course of proceedings, it was observed that the assessee has claimed business expenses amounting to Rs..12,14,379/-. As there was no business activities carried out during the relevant previous year. Therefore, the assessee was asked to show cause vide order sheet entry dated 29.11.2010 as to why all business expenses should not be disallowed. In response to the same, the AR of the assessee has filed his written submissions. The assessee s reply has been considered but is not acceptable. In view of the above, all business expenses claimed amounting to Rs..12,14,379/- are disallowed and added back to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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