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TMI Blog2014 (3) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... ue for the next two years cannot be disputed – the finding was arrived at after considering the materials including the additional evidence adduced before it – the decision in Commissioner of Income Tax v. M/s. Hughes Escorts Communications Ltd. [2007 (9) TMI 261 - DELHI HIGH COURT] and CIT v. Whirlpool of India Ltd. [2009 (8) TMI 28 - DELHI HIGH COURT] followed - once the Tribunal was of the opinion that business had commenced on account of the substantial income earned by the assessee after two years of its setting up, the view taken by the Tribunal cannot be faulted – thus, no substantial question of law arises for consideration – Decided against Revenue. - ITA 84/2014, CM APPL.3914/2014 - - - Dated:- 28-2-2014 - S. Ravindra Bhat An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid the amount together with the interest earned from the investments. The interest so paid was Rs. 4,42,11,258/- during the said financial year along with the principal sum of Rs. 7 Crores. 3. During the assessment year 2006-07, the assessee had issued a work order to M/s Wilbur Smith Associates for consultancy relating to its main activity i.e. in respect of creation of data on mobility services for generating clientele and paid professional fee which was considered to be preliminary expenses by the Assessing Officer. He, therefore, substantially disallowed it and brought it to tax in terms of Section 35D. 4. The assessee s return for AY 2007-08 reported a loss of Rs. 3,46,38,360/-. This was rejected by the Assessing Officer who rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s urged that there was no material to show that the assessee had conducted any business till the assessment year and that it had to only make some payments in 2001 at the request of the Central Government. Learned counsel emphasized that whatever income was earned was for the subsequent years and could not have been the basis for concluding that the assessee was entitled to treat this amount as income from business. 6. The ITAT s findings to the extent they are relevant are extracted below: - 7.2. After carefully consideration and in the given facts and circumstances, we are inclined to hold that assessee's business commenced from 1994-95 itself which was followed by a lull in the intervening periods. This does not mean cessation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld have enabled the government to ask the assessee to refund its amount forthwith having recognized in the books of account. This may have been counter productive for assessee. In view of these facts, we do not find any merit in the objection of the ld. DR. 7.4. Now the question will arise whether the entire amount of returns can be allowed to assessee in this year as business expenditure or not. The government has claimed it to be 'return', however, for the sake of convenience the amount has been spread over into 12 years on the logic that the returns are for amount utilized by the assessee for 12 years. The amount was by way of application for shares and due to non allotment for what-ever reasons, the government and assessee u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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