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TMI Blog2015 (4) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... nbsp; 2. The learned CIT(A) erred in law and on facts in holding that no business was set up during the relevant year. 3. Without prejudice to above grounds of appeal, the learned CIT(A) ought to have allowed part of the expenses as a deduction against income from short term capital gains after giving a finding that the same is relatable to the income from short term capital gains. 2. The facts which are revealed from the record as under. The assessee is an individual having income from the Short Term Capital Gain on shares' transactions and sale of land and income from other sources. It is stated that the assessee is having Proprietary business under the name and style of M/s. V.V. Realtors and the said Proprieta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivity in individual capacity. The assessee also relied on the decision of the Hon'ble High Court of Bombay in the case of Western India Vegetable Products 26 ITR 151 and decision of the ITAT, Pune in the case of Styler India Pvt. Ltd. Vs. Jt. CIT 113 ITD 55 (TM). The Ld. CIT(A) is not impressed with the contention of the assessee and he confirmed the action of the Assessing Officer declining to give benefit of set off of the loss of M/s. V.V. Realtors. The findings of the Ld. CIT(A) are as under: 5.2. I have considered the submission made by the appellant and perused material on record. On perusal of the computation of income it is seen that the appellant has shown earnings as 'NIL' income from business, Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) the expenditure must be expended or laid out wholly and exclusively for the purpose .of business; and 2) the expenditure must not be of a personal or capital nature. The word 'business' is capable of both narrow as well as wide interpretation. The Courts however, have always been inclined to construe this word not in its narrow sense. The word 'business' used in section 37(1) in association with the expression 'for the purpose of is a word of wide connotation. The word 'business; connotes some real, substantial and systematic or organized course of activity or conduct with a set purpose. It was so held in Narain Swadeshi Weaving Mills (1954) 26 ITR 765 (SC). In the context of a taxing statute, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommencement of business shall be allowed as permissible deduction. In the present case the appellant has not demonstrated or brought on record any evidence to indicate that any raw material or purchases were made for the business contemplated and, therefore, on facts the case is distinguishable and not applicable. 5.3.1. In the other case relied upon by the appellant of Pune ITAT of Styler India Pvt. Ltd. Vs JCIT, 113 ITD 55 (TM), it was held that the assessee company incorporated for rendering advisory and consultative services in the field of automobiles having a place of business, qualified people to render advice and having contacted various clients who entered into agreement with the assessee in subsequent years and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve that the sum so expended was wholly and exclusively utilized for the business, the decision of the Assessing Officer in making the addition of Rs. 9,00,993/- on this account was on a sound basis and liable to be upheld and ground no. 3 raised by the appellant is, therefore, dismissed. Now the assessee is in appeal before us. 4. We have heard the rival submissions of the parties and perused the record. The assessee has also filed the small compilation having 14 pages which is also considered. The Ld. Counsel reiterated the argument made before the Ld. CIT(A). We have perused the profit and loss account copy of which placed at Page No. 10 which is in respect of M/s. V.V. Realtors for the year ending 31-03-2008. The assessee has booked di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny regular systematic business activity. We do not find any reason to interfere with the order of the Ld. CIT(A). Accordingly, Ground Nos. 1 & 2 are dismissed. 6. Now we consider the alternate plea of the assessee which is Ground No. 3 that is based on the certain observations of the Ld. CIT(A) in Para No. 5.2. The Ld. CIT(A) has observed that the expenditure on account of brokerage and commission of Rs. 2,97,200/-, corporation charges of Rs. 2,000/-, Departmental expenses of Rs. 3,550/-, land survey charges of Rs. 2,500/- and Rs. 37,500/- towards legal and professional charges are expenses prima facie relate to the investments made by the assessee in land for which the Short Term Capital Gains of Rs. 56,58,340/- has been declared by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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