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2017 (11) TMI 1539 - AT - Income TaxDisallowance relating to the pre-operative expenses and legal and professional fees paid - proof of setting up of business - Held that:- In the instant case also, the moment the approval from the SEBI was received, i.e., on September 1, 2008 for commencement of AMS operation, it can be said that the business has been set up. The approval for advisory services is another activity of the assessee. Hence no fault can be found with the action of the assessee in taking the date of setting up of business as September 1, 2008. Hence all the revenue expenses incurred by the assessee after September 1, 2008 for running business enterprise cannot be treated as pre-operative expenses and should be allowable as revenue expenditure. Accordingly, we do not find any infirmity in the decision rendered by the CIT(Appeals) on this issue. Accordingly, we confirm the same. Disallowance of legal and professional fees - Held that:- Since we have already held that the business has been set up on September 1, 2008 and further expenses paid to the legal firm were related to drafting of mutual fund schemes etc., which are connected with the routine business activities, we are of the view that the learned Commissioner of Income-tax (Appeals) has rightly held the same to be revenue in nature. Accordingly, we uphold the order passed by the Commissioner of Income-tax (Appeals) on this issue also. Appeal filed by the Revenue is dismissed.
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