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2019 (6) TMI 1467 - AT - Income TaxDisallowance u/s 35D - assessee has not produced any proof of having doing any specific business activity during the relevant assessment year - proof of starting business activity - HELD THAT:- On a specific query from the Bench, what is the nature of activity of the assessee, it was submitted that the assessee imports the navigation equipments and supply it to Original Equipment Manufacturers (in short ‘OEMs’) when asked, AR as to the date of the first import to which the Ld.AR submitted that the first import was in June, 2016 and the first sale was in July, 2015. It was a submission that the Managing Director appointed was an employee and was not a shareholder. As perused the P&L A/c, Balance sheet of the assessee company for the year ended 31.03.2015 which was shown in Page Nos.179 to 223 of the paper book. The Directors Report was at Page No.179. In the Director’s Report, under the highlights of performance, it has been categorically admitted that the year ended 31.03.2015 is the first year of operation of the assessee company and the business activities are yet to be commenced. It has also mentioned that the Directors are confident to commence the business activities soon. Page No.181 is the extract of the annual return for the year ended 31.03.2015 under the Companies Act. The turnover of the assessee company has been shown at NIL. Page No.193 is the statement of P&L A/c for the year ended 31.03.2015. The Revenue is shown at NIL. The Excise Duty (products which have dealt with by the assessee being an excisable product) is shown at NIL. Other income being interest income shown at Page No.129. Salaries are shown at 13,51,285/-. Staff welfare is shown at ₹ 1,61,308/-. There were no details about number of employees. The assessee is dealing with M/s.Hyundai Motor India Ltd., and the salary payment is to only one employee being the Director. The decision the case of Ascendas is not applicable in the assessee’s case as the primary requirement of funds and the certificate for inflow has been received only on 28.03.2015 and nothing has been shown to prove commencement of business. Thus, clearly nothing has been shown that the assessee has started any business activity during the relevant assessment year. This being so, we do not find any reason to interfere with the order of the Ld.CIT(A) and consequently, uphold the same. - Decided against assessee.
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