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TMI Blog2018 (3) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... Authorities under the Act, to be lacking. Finding of fact arrived at by the Authorities under the Act, cannot be said to be perverse. No substantial question of law. - Income Tax Appeal No. 1149 of 2015 - - - Dated:- 5-3-2018 - M.S. SANKLECHA SANDEEP K. SHINDE,JJ. Mr. K. Gopal with Mr. Tanmay Phadke, for the Appellant. P.C: This Appeal under Section 260A of the Income Tax Act, 1961 (the Act), challenges the order dated 17th April, 2014 passed by the Income Tax Appellate Tribunal (the Tribunal). The impugned order dated 17th April, 2014 is in respect of Assessment Year 2005-06. 2. Revenue urges the following questions of law, for our consideration: (a) Whether the Tribunal was right in law in disallowing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal by the impugned order, on examination of the facts notes as under: 5.2: Coming to the facts of the case, the company claims to have appointed MD as well as Chief Operations Manager, putting the infrastructure in place by acquiring office premises, staff furniture and fittings etc. No grant of any operational lease by the year end should not, therefore, be of any consequence. We agree, so that if the infrastructure has indeed been set up and the company is in position or is ready to grant operational leases, which is to comprise its principal business and that toward the commencement of which line of business efforts were, as stated, being made, it can be said to have set up its business. However, as also noted by both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Has the company entered into a relationship with any vehicle supplier inasmuch as, as distinct from a financial lease, the risk and reward of the ownership in case of an operating lease tests with the lessor, so that the terms of the lease could not be agreed upon (with the customers) unless it has a complete understanding of the product, the risks associated with the ownership and management thereof, including by way of insurance, costs, applicable taxes. Why, even a financial lease or arrangement would require an arrangement/s or tie up with the vehicle supplier or manufacturer, enabling competitive offers to the customers through their preferred financial channels. Then, again, has the company undertaken study of the legal issues incide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to discharge its functions for which it has been set up. It is only when the unit has been put into such a shape that it can start functioning be it trading or a manufacturing operations that it can be said that the unit has been set up. This is to be determined on the basis of the facts found. In this case, all the authorities under the Act have found on facts that the Appellant's business had not been set up inasmuch necessary evidence in support of its claim that the business has been set up and is ready to commence, had not been led by the Appellant. The test applied by the Tribunal viz: was the company in a position to commence its business by having the operational infrastructure in place. On facts, it was found that operational ..... X X X X Extracts X X X X X X X X Extracts X X X X
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