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TMI Blog2018 (4) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... his purpose of verification of the quantum, we set aside the issue to the file of the AO with a direction that after verification and if the claim is found to be genuine, the AO will allow the same. - Decided against revenue - I.T.A. No.1410/DEL/2014 - - - Dated:- 2-4-2018 - Shri J. S. Reddy, Accountant Member And Shri Amit Shukla, Judicial Member Appellant by : Shri R.S. Singhvi Satyjeet Goyal, CA. Respondent by : Shri Amit Jain, Sr.D.R. ORDER Per Amit Shukla, J. M. The aforesaid appeal has been filed by the Revenue against impugned order dated 19.12.2013 passed by Ld. CIT(A)-VIII, New Delhi for the quantum of assessment passed u/s.143(3) for the Assessment Years 2009-10. In the grounds of appeal, the Revenue has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng expenses:- Sl. No. Expenditure Head Amount 1. Donation Expenses Rs.11,000/- 2. Penalty charges Rs.2,800/- 3. Employees Contribution fund deposited late Rs.27,47,332/- 4. Expenses to be disallowed under section 43B Rs.1,73,241/- Total Rs.29,34,282/- 5. AO further noted that assessee has not shown any receipt from the business and in response to the show cause no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there was stoppage of business since financial year 2002-03 and the closure of business activity continued till the relevant financial year. b. Effectively there was no business activity in the relevant financial year 2008-09 and under any stretch of imagination, this cannot be construed as temporary suspension of business activity. c. The very definition of the business suggests that it is a continuous process and the process cannot be discontinued for such a long period as in the instant case. d. The claim of the assessee has been rejected by the appellate authorities in the earlier assessment years. The details are as per the table given below: - Assessment year De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecided to renovate and redevelop the hotel property and therefore the hotel operations of the Lodhi Hotel were temporarily suspended. The hotel building was reconstructed and renovated and the construction has been completed in the year under appeal. The appellant has filed a copy of Completion Certificate issued by Municipal Corporation of Delhi. It is seen that the appellant had filed an application for issue of completion certificate on 30, July, 2007 and the certificate had been issued on 12, January, 2009. As mentioned in the comparative chart the building was complete during the year, the appellant got consent from the Delhi Pollution Control Committee and Environment Clearance for redevelopment of old Lodhi Hotel. The appellant has h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. Applying the same ratio decided in these cases, it has been held that only when the hotel property is ready to receive clients then only it would amount to commencement of business. As per the details filed by the appellant, it is seen that the aforementioned details were available before the Assessing officer during the course of assessment proceedings. The appellant had stated that there was specific question regarding the receipt from the hotel business and the details were filed during assessment proceedings. The observation made by the Assessing Officer that there was no business activity during the year appears to be erroneous. The details and documents on record show that the hotel property was in a position to receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il 2009. Further, Learned CIT(A) also, vide para 5.2 of his order, clearly held that there is no dispute over the fact that the hotel activity was temporarily in suspension. It, therefore, makes the things amply clear that the intention of the assessee was to temporarily suspend the business and not to bring the business to a close. 20. In these circumstances, we find it difficult to agree with the findings of the learned AO that inasmuch as during the financial year 2006-07 the assessee was unable to cater the needs of the customers, the business was not yet commenced. We also do not agree with the theory of estoppel proposed by the learned CIT(A) that since the assessee did not claim the expenses relatable to Asstt. Year 2002-03 for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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