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2019 (3) TMI 1295 - AT - Income TaxAllowability of expenses u/s 37 - SEBI approval on 17.10.2012 - asset management company - certificate of registration for the mutual fund scheme from SEBI after end of financial year - twin conditions, firstly that the tax- payer company should be registered under the Companies Act, 1956 and secondly it should be approved as such by SEBI - HELD THAT:- Thus, we hold that the business of the assessee before us was set up and ready to commence its business on 17.10.2012 when it got approval from SEBI vide Sub-regulation (2) of Regulation 21 of the 1996 Regulation. We, therefore, hold that the assessee is entitled to a deduction of admissible business expenses incurred by it on or after 17.10.2012 when the business can be said to have been set up by the assessee. We, therefore, direct the Assessing Officer to quantify the amount of expenses in the light of our decision above and allow the same as per law after examining and verifying the genuineness of the expenses and their admissibility under the provisions of Income-tax Act which were incurred post 17.10.2012 till the end of the relevant previous year under consideration before us. The AO shall provide reasonable opportunity of being heard to the assessee while quantifying the amount of business expenses incurred by the assessee on or after 17.10.2012 till the end of the relevant previous year under consideration before us. Since, both the authorities below failed to consider this relevant and vital event of grant of SEBI approval in favour of the assessee on 17.10.2012, we direct the assessee to produce the copy of aforesaid SEBI approval before the AO for necessary verification and records - The appeal of the Revenue is partly allowed as indicated above.
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