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Claim of expenses during suspension of business by District Magistrate. Analysis: The appeals filed by the assessee, who runs a cinema, were consolidated as the issues were similar. The District Magistrate suspended the exhibition of films by the assessee, leading to a claim of expenses for the period when the business was suspended. The Income Tax Officer disallowed the expenses, stating that the business had been closed due to the District Magistrate's order. The assessee argued before the Appellate Assistant Commissioner that the business became dormant, not ceased, and the expenses should be allowed as the old license was renewed. However, the Appellate Assistant Commissioner upheld the disallowance, considering the District Magistrate's order as resulting in the discontinuance of business. The Departmental Representative supported the Appellate Assistant Commissioner's decision, citing relevant judgments. They argued that the business was completely discontinued due to the District Magistrate's order, and the renewal of the license constituted a new business. The assessee contended that the old license was renewed, not a new one. After hearing both parties, the Tribunal held in favor of the assessee. The Tribunal found that the business did not discontinue but remained dormant during the suspension period, as evidenced by the successful renewal of the old license. Therefore, the expenses incurred during the dormancy of the business were deemed incidental to business, and the assessee was entitled to the claim for all three years. In conclusion, the Tribunal allowed all three appeals filed by the assessee, emphasizing that the business was dormant, not discontinued, during the suspension period, and the expenses claimed were incidental to business. The decision was based on the factual scenario, rendering the reliance on case laws unnecessary as the law follows the facts.
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