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TMI Blog2016 (1) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... n law in deleting the disallowance of Rs. 24,64,325/- made by the Assessing Officer on account of not carrying any business activity. ii. The appellant craves leave, to add, alter or amend any ground of appeal raises above at the time of hearing. 2. The facts in brief, as culled out from the order of the lower authorities, are that the return of income for the assessment year 2005-06 was filed on 25.10.2006 declaring los of Rs. 34,47,327/- which was revised subsequently on 31.03.2007 declaring loss of Rs. 34,71,886/-. The case was selected for scrutiny through CASS and statutory notice under Section 143(3) of the Income-tax Act, 1961 (for short "the Act") was issued. The company was incorporated on 30.06.1995 and was engaged in the manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.K. Jain pursued the legal cases in connection with repayment of liabilities of the assessee company and protection of its fixed assets, legal cases with Kerala State Electricity Board in respect of rate of supply of electricity, dispute with ESI Department etc. Further, the assessee submitted that the minimum salary to other staff and security expenses etc. were only incurred. The assessee also submitted detail of the litigation with IFCI Ltd. and ESIC. In support of its contention, the assessee also relied on the various case laws. After discussing the submissions of the assessee, the learned Commissioner of Income Tax (Appeals) sustained the addition of Rs. 3,55,871/- and Rs. 51,779/- paid to the employees towards retrenchment, compens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details and justification of other expenses disallowed by the AD and as clarified by A.R vide letter dated 23.11.2011 and dated 17.11.2011, it is further found that the expenses disallowed by the Assessing Officer were those expenses which were necessary to carry on day to day activities and to defend the various legal proceedings against the appellant company. The expenses which have been disallowed are in the nature of salary and wages, repair & maintenance, telephone, vehicle running and maintenance, rent paid, miscellaneous expenses, conveyance and travelling, etc which are required to carry on and maintain the basic infrastructure of the appellant company and to carry on the day to day activities of the appellant company. However ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce sustained by the Commissioner of Income Tax (Appeals) was mentioned incorrectly at Rs. 24,64,325/- as against the correct amount of Rs. 20,56,675/-. 4. We have heard the rival submissions of the parties and perused the material on record. We find from the details of the expenses filed in paper book and in the order of the Commissioner of Income Tax (Appeals) that those expenses were bare minimum required for the purpose of securing interest of the company for defending legal cases in connection with the liabilities, protection of assets and pursuing legal cases with the Government Departments. We find that the learned Commissioner of Income Tax (Appeals) has considered all the facts and circumstances of the case and upheld the disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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