Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2018 (5) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (5) TMI 1091 - HC - Income TaxDisallowance of business expenditure - business activity not commenced - Held that:- Primarily, the assessee had carried out market survey and made certain general inquiries about source of the commodity and prospective buyers. As correctly noted by the AO, even between the letters written by the assessee to the buyer and seller and annual culmination of any transaction of sale or purchase, there was substantial time gap of over one year in almost every case and in some cases over two years. AO therefore refused to link said letters written by the assessee to the actual transaction of sale or purchase. In absence of any income generation, it was difficult to understand how the staff was paid bonus as claimed by the assessee. Tribunal further recorded that there was no evidence on record to suggest that the assessee has registered itself as a trading concern or had procured statutory licenses from the State or the local authorities. There is nothing on record to suggest that the assessee had actively solicited business and the negotiations in the parlance buyers and sellers were at advance stage or were at any concrete form. There was significant time gap in such correspondences and actual sale and purchase transaction. - Decided against assessee.
|