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TMI Blog2023 (4) TMI 376X X X X Extracts X X X X X X X X Extracts X X X X ..... why when there is no closer of business during the year accept for there was no business income why the general and administrative expenses can be disallowed. Temporary suspension of business does not mean it is dissolved on the business is completely shut down its Akin to Lull business which as stated by the assessee was various genuine reasons. Accordingly, in principle such expenses cannot be disallowed. Legal expenses payments have been made by the assessee for the filling of various suit for recovery of money from the debtors like Fancy Impacts, Marble Gems, Asugems Sugey Gems which is still pending, and the suits were filed in 2012. Thus, this legal expenses cannot be disallowed as they have been incurred during carrying of the busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ired to be incurred even if there was no business activity during the year under consideration. 2. The Ld. CIT (A) - 59 has erred in law and in facts in disallowing depreciation of Rs 55,00,367/- on assumptions and presumptions basis ignoring the fact that no new asset was purchased and such depreciation was claimed on the assets acquired in earlier years which were used for the purpose of the business. 2. The facts in briefs are that assessee is a partnership form which was carrying on the business of "Manufacture and Export of Diamonds" from last several years. During the year Assessee had filed return of income issuing total loss of Rs. 53,81,543/-. The Assessing Officer from the perusal of the audited financial statements noted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Ld. CIT (A) too after noting down various judgments has confirmed the order of the Assessing Officer which are not been discussed here, because it is more on preposition of law and his interpretation of certain judgments. 5. Before the Ld. CIT(A), Assesses also filed various documents in form of additional evidence rule 46A in support of the expenses incurred during the year, which has been rejected by him. After detail discussion he held that expenditure cannot be allowed. Another finding given by him was that certain expenses, are disallowable u/s 40(a)(ia) on account of non deduction of TDS. 6. We have heard both the parties, perused the relevant finding given impugned orders. The main issue involved is disallowance of various exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es which are incurred during the normal course of business. Merely because assessee did not have any business income during the year, that does not lead to any inference, that business has been completely shut down during the year, i.e., in the year under consideration. There is nothing on record that assessee had closed down the business completely and has wounded up during this year. There is a distinction between temporary suspension of the business or lull in the business and complete closer of the business. 8. The Ld. CIT (A) has noted that even after this year, Assessee has not corrected in commercial activity. During the course of hearing were asked the Ld. Counsel for the Assessee as to whether assessee has claimed any such expense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f recovery of money. From perusal of these documents it is seen that the payments have been made by the assessee for the filling of various suit for recovery of money from the debtors like Fancy Impacts, Marble Gems, Asugems Sugey Gems which is still pending, and the suits were filed in 2012. Thus, this legal expenses cannot be disallowed as they have been incurred during carrying of the business. 10. However, before us the Ld. DR submitted that Ld. CIT(A) has observed no TDS have been deducted on such payment of professional fees and therefore same should be disallowed u/s 40(a)(ia). 11. Before us, the Ld. Counsel cannot clarify that, whether any TDS have been deducted, therefore this matter is restored back to the file of the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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