The House of Jainsons Ltd., New Delhi V. ACIT, New Delhi

ITA 314/DEL/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3674 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 24-06-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 18-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MONA MOHANTY
• Assessee Lawyers: M L MUTNEJA

Judgement Text

ITA NO. 314/DEL/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO. 314/DEL/2011 A.Y. : 2006-07 THE HOUSE OF JAINSONS LIMITED, 15-N, BLOCK MARKET, GREATER KAILASH-I, NEW DELHI (PAN : AAACT2435P) VS. ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-12, JHANDEWALAN, NEW DELHI (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) (RESPONDENT ) ASSEESSEE BY : SH. M.L. MUTNEJA, CA DEPARTMENT BY : MS. MONA MOHANTY, D.R. ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DATED 30.11. 2010 PERTAINING TO ASSESSMENT YEAR 2006-07. 2. THE ISSUE RAISED IS THAT LD. COMMISSIONER OF IN COME TAX (APPEALS) ERRED IN CONFIRMING THE DISALLOWANCE OF ` 80,040/- MADE BY THE ASSESSING OFFICER. 3. IN THIS CASE THE ASSESSEE FILED ITS RETURN OF I NCOME DECLARING TOTAL INCOME OF ` NIL AND CARRY FORWARD LOSS OF ` 67,60,5 52/-. THE EXPENSES ITA NO. 314/DEL/2011 2 FOR THE CURRENT YEAR AMOUNTED TO ` 80,040/- FOR AUD IT FEE, BANK CHARGES, FILING FEES, LEGAL AND PROFESSIONAL EXPENS ES, TELEPHONE EXPENSES, RENT PAID AND RATES AND TAXES. ASSESSIN G OFFICER OBSERVED THAT NO BUSINESS ACTIVITY HAS BEEN CARRIED BY THE C OMPANY. HE PROCEEDED TO DISALLOW THE ABOVE SAID EXPENDITURE. 4. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE ASSESSING OFFICERS ACTION . 5. AGAINST THIS ORDER THE ASSESSEE IS IN APPEAL BE FORE US. 6. WE HAVE HEARD THE RIVAL CONTENTIONS IN LIGHT OF THE MATERIAL PRODUCED AND PRECEDENT RELIED UPON. WE FIND THAT A SSESSING OFFICER HAS DISALLOWED THE TOTAL EXPENDITURE OF ` 80,040/- FOR THE CURRENT YEAR ON THE GROUND THAT NO BUSINESS ACTIVITY HAS BEEN DO NE DURING THE CURRENT YEAR. IN THIS REGARD, LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT IT WAS A TEMPORARY LULL IN THE BUSINESS AND BE CAUSE OF THIS ASSESSEE COULD NOT MAKE ANY SALE DURING THE YEAR AND SUBSEQUENTLY ASSESSEE HAS BEEN ABLE TO DO THE BUSINESS AND MAKE S ALES. ACCORDINGLY, HE ARGUED THAT THE EXPENDITURES FOR TH E CURRENT YEAR WERE BARE MINIMUM ADMINISTRATIVE EXPENSES NECESSARY TO MAINTA IN THE INFRASTRUCTURE OF THE COMPANY. ITA NO. 314/DEL/2011 3 7. LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER H AND COULD NOT CONTROVERT THE ABOVE SUBMISSIONS. 8. HENCE, IN THE BACKGROUND OF THE AFORESAID DISCUS SION, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DECID E THE ISSUE IN FAVOUR OF THE ASSESSEE. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/6/2011 UPO N CONCLUSION OF HEARING. SD/ SD/ SD/ SD/- -- - SD/ SD/ SD/ SD/- -- - [A.D. JAIN] [A.D. JAIN] [A.D. JAIN] [A.D. JAIN] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 24/6/2011 SRB COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES