Pravin Trust, Mumbai vs Assessee

M/s. Pravin Trust, ITO 14(1)(1), 1st Floor, 333, R.No.204, 2nd Floor, Shaikh Memon Street, Earnest House, Vs. Corner of Mirchi Gally, Nariman Point, Green Market, Mumbai - 400021 Mumbai - 400 002 PAN: AAATP 0521H (Appellant) (Respondent)

Assessee by : Shri Apurva Shah, A.R. Revenue by : Shri Premanand J., D.R.

Date of Hearing : 18.12.2014 Date of Pronouncement : 04.03.2015

ORDER

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against the order dated 25.06.2012 of the Commissioner of Income Tax (Appeals) [(hereinafter referred to as CIT(A)] relevant to assessment year 2009-10.

2. The sole ground taken by the assessee is relating to the confirmation of disallowance of business expenses of Rs.3,02,333/-. During the assessment proceedings, the Assessing Officer (hereinafter referred to as the AO) observed that the assessee had claimed different business expenses amounting to Rs.3,02,333/- inspite of the fact that there was no business activity during the year. Being not satisfied with the explanation given by the assessee in respect of the matter, he disallowed the expenses.

2 ITA No.5773/M/2012 M/s. Pravin Trust

3. In appeal before the Ld. CIT(A), the assessee submitted that there was a temporary lull and business had become temporary dormant. However, the stock was not written off. Due to the poor financial condition of the assessee, no sale or purchase transaction was carried out during the year. The Ld. CIT(A), however, observed that the assessee had carried out its business activity up to the financial year 2003-04 only. The assessee had shown opening stock consisting of groundnuts, chilly, cumin seeds, coriander seeds etc. which were carried forward as closing stock. The business was not continued after A.Y. 2004-05. Hence, it could not be said that there was a temporary lull. The claim of the expenses was not justified without carrying out any single transaction of trading. He therefore confirmed the disallowance.

4. We find that the stock in trade has been shown of groundnuts, chilly, cumin seeds, coriander seeds etc. which commodities are perishable in nature. The assessee had carried out its last business activity in the year 2004. The stock, which has a very small shelf life, cannot be presumed to have existed up to the year under consideration. Even the assessee has not given any evidence to show that the business has been recommenced even till date. Under such circumstances, the claim of expenditure in relation to business activity of the assessee cannot be held to be justified. We do not find any infirmity in the order of the Ld. CIT(A) and the same is hereby upheld.

5. In the result, the appeal of the assessee is therefore dismissed.

Order pronounced in the open court on 04.03.2015.

Sd/- Sd/-

(R.C. Sharma) (Sanjay Garg) ACCOUNTANT MEMBER JUDICIAL MEMBER

Mumbai, Dated: 04.03.2015. * Kishore, Sr. P.S. Copy to: The Appellant 3 ITA No.5773/M/2012 M/s. Pravin Trust The Respondent The CIT, Concerned, Mumbai The CIT (A) Concerned, Mumbai The DR Concerned Bench //True Copy// [

By Order

Dy/Asstt. Registrar, ITAT, Mumbai.