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TMI Blog2016 (9) TMI 205X X X X Extracts X X X X X X X X Extracts X X X X ..... f Anita Jain (2009 (1) TMI 774 - DELHI HIGH COURT ), which was relied upon by the assessee before us, supports the allowability of such expenditure. Therefore, on this count we allow the plea of the assessee. Insofar as the payment of interest is concerned, the dispute raised is similar to what was considered by the Tribunal in assessee’s own case for Assessment Year 1998-99. On this aspect, assessee had pointed out before the lower authorities that since the past investments have been made in stock-in-trade of shares and such investments were made out of funds available from Partners Capital and other loan funds, on such loan funds assessee had incurred interest expenditure which has been disallowed. In Assessment Year 1998-99 similar c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct ). 3. Although the assessee has raised multiple Grounds of appeal, but essentially the grievance is against the action of Income-tax authorities in holding that no business activity was carried out by the assessee, thereby denying the claim of loss determined on account of expenses claimed in the Profit Loss account. To put it differently, the claim of the assessee is that the business loss determined at ₹ 24,35,949/- has erroneously not been considered by the Assessing Officer for set-off against other income of the year. 4. Briefly put, the relevant facts are that the appellant is a partnership firm whose stated business objectives are trading in polyester yarn, fabrics, shares and securities, commission agency. For the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned, it was made in the past years out of funds available with the assessee by way of Partners Capital, interest from deposits and interest bearing loans raised from time to time. In this manner, expenditure on interest was sought to be justified. With regard to the general administrative expenses claimed in the Profit Loss account, it was pointed out that same were genuine. It was pointed out that though in the year under consideration there was no sale of shares, but for the immediately preceding Assessment Year assessee had sold shares of ₹ 24,99,400/- out of its opening stock of shares. It was, therefore, sought to be pointed out that the finding of the Assessing Officer that there was no trading activity carried out by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade to HDFC, Partners and other loans, the learned representative pointed out that a similar issue had come up before the Tribunal in Assessment Year 1998-99 and vide ITA No. 3167/Mum/2001 dated 15.3.2005, the claim of the assessee has been allowed. Even on this count, it was sought to be contended that there was no reason to disallow the expenditure on interest or even on general and other administrative expenses debited in the Profit Loss account. 7. On the other hand, the ld. DR appearing for the Revenue has primarily reiterated the arguments taken by the lower authorities, which we have already adverted to in the earlier paragraphs and are not repeated for the sake of brevity. 8. We have carefully considered the rival submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc. In our considered opinion, the factual matrix of the case supports the plea of the assessee that it is not a case of discontinuation or closure of business, but temporary lull in activity. During this period of lull or interregnum, the assessee is expected to continue maintenance of its business apparatus and for that purpose the expenses of general and administrative nature claimed by the assessee deserve to be allowed. In this context, we find that the ratio of the judgment of the Hon ble Delhi High Court in the case of Anita Jain, 182 ITR 173 (Del) , which was relied upon by the assessee before us, supports the allowability of such expenditure. Therefore, on this count we allow the plea of the assessee. 9. Insofar as the payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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