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TMI Blog2016 (5) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... earned Commissioner of Income Tax (Appeals) has failed to appreciate that the distinction between "suspension" of existing business on account of adverse business environment and "cessation" of business and as such, disallowance sustained is absolutely misconceived. 1.3 That without prejudice and even otherwise, the learned Commissioner of Income Tax (Appeals) has failed to appreciate that the aforesaid expenditure has been incurred for maintaining and protecting the assets of the appellant company and to discharge statutory obligations of the appellant company and therefore, such an expenditure even otherwise was an admissible business expenditure. 2 That the learned Commissioner of Income Tax (Appeals) has erred both in law and on facts in sustaining disallowance of Rs. 1,80,0001- representing statutory deduction claimed u/s 24(a) of the Act. 2.1 That the finding of the learned Commissioner of Income Tax (Appeals) that on plot of land was leased overlooks the buildings constructed by the assessee and forming part of fixed assets declared in financial statement furnished alongwith return of income." 2. The relevant facts of the case are that in the year under consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s possible. Sir, the appellant will be too willing to provide any further information which your good self shall require to dispose of the appeal." 4.1. Apart from that reliance was placed upon, the following two decisions namely Hon'ble Punjab & Haryana High Court in the case of CIT vs. Nahar Exports Ltd. reported at 213 CTR page 20 (P & H) and Hon'ble Madras High Court in the case of CIT vs. Chennai Petroleum Corporation reported at 262 CTR 664(Mad.). 4.2. Not convinced with the explanation offered the ground was rejected holding that where the business operations in the case of assessee were closed in the month of September, 2007 and have not restarted till date, it could not be said to be a case of temporary closure of business in a particular year but a case of permanent closure extending for the last 7 to 8 years. The case law relied upon was held to be distinguishable as temporary closure of business was established there. Accordingly the Assessing Officer was held to be correct in disallowing the expenses and the depreciation claimed by the assessee. 5. Qua the disallowance of Rs. 1,80,000/- the view taken by the AO was confirmed holding as under :- "5.3. I have ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] amongst others it was his submission that the expenses deserved to be allowed. Addressing the past history it was submitted that in all the earlier years the returned income has been accepted by an order under section 143(1). Only in 2008-09 assessment year the returned income was accepted by an order passed under section 143(3) accepting the declared loss of Rs. 16,36,041/-. Copy of this order dated 27/12/2010 it was submitted is available in the paper book page 14. 8. Addressing ground No. 2 in the present appeal it was submitted that no doubt the property has been described as a plot of land in para 1 of the lease deed. However when the said para is read along with para 2 it would be clear from the reference made to the payment of electricity charges which the lessee was to pay as per the reading on the MSEB meter which would pre-suppose that some construction would necessarily be there. Apart from that it was his submission that due to the limitations in the recital as the lease deed has not been worded very appropriately, he was not in a position to rely on any other evidence. However it was submitted it cannot be concluded that it was only a piece of land which was leased ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an issue before us. Copy of the lease deed has been filed before us is placed at pages 22 to 25 of the paper book. We find that the lease has been entered into between the assessee that is Micro Turner's Pvt. Ltd. (formerly known as A K Turner's Pvt.Ltd.) having it's registered office at Hissar Road, Rohtak and Micro Turner's (a partnership firm registered under the Partnership Act) also having its registered office at Hissar Road, Rohtak. We find there from that the plot of land has been leased for a period of 20 years from 01/01/2011 on the following terms and conditions:- a. "Lessee shall pay to Lessor Rs. 50,000/- (Rs.Fifty thousand only) per month as Rent for use of the said property. b. Lessee shall pay electricity charges as per his use/MSEB Meter. c. Lessee shall pay all other local charges till expiry of lease period. d. The Lessee shall be allowed to make any permanent construction or alternations in the said plot as per his requirements without the previous consent of the Lessor. e. The Lessee will not assign, transfer, sublet or put parts of possession of any part thereof of the Land any time during the period of Lessee. f. The Lessee shall permit the L ..... 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