METAOXIDE PRIVATE LIMITED,NEW INDIA CENTRE vs. ASSESSING OFFICER, DELHI
IN THE INCOME TAX APPELLATE TRIBUNAL
“SMC” BENCH MUMBAI
BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER
Metaoxide Pvt Ltd.,
5th Floor, New India Centre,
17 Cooperage Road, Mumbai
– 400039. Vs.
DCIT, Circle – 1(2)(1)
Mumbai
PAN/GIR No. AAACM4043L
(Applicant)
(Respondent)
Assessee by Shri B.N. Rao a/w Shri Sandesh, Adv
Revenue by Ms. Madhura M. Nayak Sr. Ld.DR
Date of Hearing
07.05.2025
Date of Pronouncement
27.05.2025
आदेश / ORDER
PER SANDEEP GOSAIN, JM:
The present appeal has been filed by the assessee challenging the impugned order 11.02.2025 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the National
Faceless Appeal Centre, Delhi (NFAC) for the assessment year 2015-16. 2. The only ground raised by the assessee relates to challenging the order of Ld. CIT(A) in disregaring the claim relating to business expenditure of the assessee.
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Metaoxide Pvt Ltd, Mumbai
I have heard the counsels for both the parties, perused the material placed on record and also the orders passed by the revenue authorities. 4. From the records, I noticed that as per the facts of the present case, AO completed the assessment u/s 144 of the Act and thus while completing the assessment brought to tax rental income and interest income as per 26AS to tax. And while assessing the rental income no standard deduction were allowed u/s 24 of the Act. 5. However, on appeal, Ld. CIT(A) while giving relief under income from house property has disregarded the claim of the assessee relating to business loss of Rs. 30,38,711/- holding that there was no ‘business activity’ in the assessee’s company during the year under consideration. 6. After having gone through the facts as well as documents placed on records of the present case, I found that the assessee company had made purchases of artwork worth of Rs. 7,45,66,780/- during the year under consideration and was thus involved into the ‘business activity’ as the word “business” activity involves either “purchase” or “sales” and it is not essential to earn revenue every year. In this regard assessee has placed on file copy of balance sheet for the year ended 31.03.2015. The movement of goods was establish from the fact that there
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Metaoxide Pvt Ltd, Mumbai was opening stock and new stock is added by way of purchase, which is carried over at the year end as closing stock.
7. Ld.CIT(A) has not considered the movement in goods as well as computation of income filed before him, as he has referred only to the revenue from operations instead of looking into the whole of the profit and loss account as well as balance sheet.
8. Since as per record, the assessee was into high end sales and purchase of expensive artworks. Therefore, practically sometimes it becomes eminent to hold the stock till the time it does not fetch good value, as the expensive artworks are the fancy collections of elite people, which get value based on the artist who created it, the theme and other factors including its antique value and therefore, under the circumstances, the old work may be sold in the same year of purchase or remains as stock in trade depending upon the demand and supply situation for the product dealt by the business entity and who establish its business operations. Even assessee has also placed on record the annual accounts for the subsequent year i.e. FY
2016–17,
Wherein the revenue generation of Rs.
1,41,32,467/- is recorded.
9. Therefore, considering the entire facts and circumstances of the present case, it is established that 4
Metaoxide Pvt Ltd, Mumbai the assessee company is into ‘business operations’ during the year under consideration and is thus entitled to get the claim of business loss set off against house property income. It is ordered accordingly.
10. In the result, the appeal filed by the assessee stands allowed.
Order pronounced in the open court on 27.05.2025. (SANDEEP GOSAIN)
JUDICIAL MEMBER
Mumbai, Dated 27/05/2025
KRK, PS
आदेश की ितिलिप अेिषत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. थ / The Respondent.
3. संबंिधत आयकर आयु / The CIT(A)
4. आयकर आयु(अपील) / Concerned CIT
5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, मुबई / DR, ITAT, Mumbai
6. गाड फाईल / Guard file.
आदेशानुसार/ BY ORDER,
सािपत ित ////
उप/सहायक पंजीकार ( Asst.