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TMI Blog2017 (5) TMI 210X X X X Extracts X X X X X X X X Extracts X X X X ..... cked up, was also not before the authorities below. However the proposition that when there is a temporary lull in the business, it cannot be said that there is a cessation of business by the assessee, is supported by the decision of Hon’ble High Court decision as cited above. When there is no cessation of business, assessee is engaged in doing business and the business expenditure as appropriate deserves to be allowed. However since we note that the additional evidence and the new submissions were not before the authorities below, hence in the interest of justice we remit this issue the file of the A.O. The A.O shall examine the issue afresh in light of the additional submissions of the assessee. Appeal of the assessee allowed for stati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding decision to invest in shares, securities etc. depending upon market conditions is an income from other sources and has erred in not holding that it is an income from business activities. 4) On facts and circumstances, The Learned Commissioner of Income-tax (Appeals)-5, Mumbai, has erred in confirming disallowance of ₹ 93,00,890/- being travelling and salaries paid to staff on the ground that no business is carried on. 5) The Appellant reserves right to add, alter or amend the above grounds of appeal as and when found necessary. 3. The facts are that assessee company has shown income from investment activities such as interest, dividend and gain on sale of shares and Mutual funds. The total income of ₹ 1,24,06,953 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oning the AO held that the expenses totalling to ₹ 1,32,07,059/- claimed by the assessee cannot be allowed as a deduction u/s 48 Sec. 57 of the IT Act. The assessee had claimed travelling expenses amounting to ₹ 6,12,858/- on account of air ticket of Prashant K. Trivedi on his foreign visits. The AO noted that the expense was not allowable because the activities carried out by the assessee was that of investment in shares and units of Mutual funds and interest on FDs; and that the investment activity was also carried out by portfolio management service from the bank. No separate disallowance thereon was however made as the same was part of the disallowance made otherwise. Since the assessee had added back ₹ 39,06,169/- s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts in shares as well as fixed deposits are to be considered as its stock in trade is misplaced. The income on sale of shares/Mutual funds itself have been shown by the assessee as capital gain and that itself negates the argument/stand taken by the assessee. This is a case where assessee has deployed competent personnel staff to carry out equity research and after due consideration, the decision is taken for investment in equity shares/ Mutual funds. In between when a study suggests adverse scenario of the market for investment in shares/Mutual funds, the funds are placed in banks as fixed deposits. Therefore, its plea that fixed deposits are also held as stock in trade and investment thereof should be treated as its business activity is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable under the head income from other sources . The short term capital gain too has been shown at ₹ 9,94,215/-. The deduction there from is allowable u/s 48 of the IT Act. The AO did not give any allowance thereof for the reason that such expenses could not be covered u/s 48 also. In the facts of the case, in my considered view the AO has taken the correct and just view and does not call for any interference. 5. Against the above order assessee is in appeal before us. We have heard both the counsel and perused the records. Ld. Counsel of the assessee submitted that there has only been a temporary lull in the business. He submitted that assessee has shown substantial income in assessment year 2007-08 and 2008-09. No such disa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of business by the assessee, is supported by the decision of Hon ble High Court decision as cited above. When there is no cessation of business, assessee is engaged in doing business and the business expenditure as appropriate deserves to be allowed. 7. However since we note that the additional evidence and the new submissions were not before the authorities below, hence in the interest of justice we remit this issue the file of the A.O. The A.O shall examine the issue afresh in light of the additional submissions of the ld. Counsel of the assessee. Needless to add assessee should be granted adequate opportunity of being heard. Both the counsel fairly agreed with this proposition The result this appeal by the assessee is allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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