Western India Vegetable Products Ltd. v. CIT

26 ITR 151High Court1954#995 most cited

What is Western India Vegetable Products Ltd. v. CIT authority for?

Revenue expenditure incurred after a business is set up and ready to commence, but before its actual commencement, is allowable as a deduction even if no income is earned in that period. The previous year for a business begins from the date it is set up.

108

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2026.

Also referred to as

Western India Vegetable Products Ltd. v. CIT · 26 ITR 151 · Section 10(2) · Section 37(1) Income Tax Act 1961 · setting up of business · commencement of business · revenue expenditure · business deductions · previous year

Sections most often in play

Section 143(2)Section 10(2)Section 142(1)Section 143(3)Section 1961Section 250Section 115JBSection 139(1)

Issues it is cited on

section 10(2)section 57(iii)section 57revenue expendituresection 10income from other sourcesprevious yearcompanyindiabusinesssection 143section 143(3)

Judgments citing Western India Vegetable Products Ltd. v. CIT

Messung Systems Private Limited, Pune vs. Income-Tax Officer, Ward - 14 (4), Pune

In the result, the appeal filed by the assessee stands partly allowed for statistical purposes

ITA 683/PUN/2018[2014-15]Status: DisposedITAT Pune07 Nov 2022AY 2014-15

Bench: Shri Inturi Rama Rao & Shri S. S. Viswanethra Raviआयकर अपील सं. / Ita No.683/Pun/2018 िनधा"रण वष" / Assessment Year: 2014-15 Messung Systems Private Vs. Ito, Ward-14(4), Pune. Limited, 501, Lunkad Skyvista, Sr. No.230/A/3/2, Viman Nagar, Pune- 411014. Pan : Aabcm1832E Appellant Respondent Assessee By : Shri Nikhil Pathak Revenue By : Shri M. G. Jasnani Date Of Hearing : 29.08.2022 Date Of Pronouncement : 07.11.2022 आदेश / Order Per Inturi Rama Rao, Am: This Is An Appeal Filed By The Assessee Directed Against The Order Of Ld. Commissioner Of Income Tax (Appeals)-7, Pune [‘The Cit(A)’] Dated 15.02.2018 For The Assessment Year 2014-15. 2. Briefly, The Facts Of The Case Are That The Appellant Is A Company Incorporated Under The Provisions Of The Companies Act, 1956. It Is Engaged In The Business Of Trading Of Programmable Logic Controllers (Plc) & Parts Thereof. The Return Of Income For The Assessment Year 2014-15 Was Filed On 30.09.2014 Declaring Total

For Appellant: Shri Nikhil PathakFor Respondent: Shri M. G. Jasnani
Section 143(3)

…pn. Ltd., 192 ITR 151 (SC) followed by the Hon’ble Gujarat High Court in the case of Sarabhai Management 5 Corpn. Ltd. vs. CIT, 102 ITR 25 (Guj.) and also followed by the Hon’ble Bombay High Court in the case of Western India Vegetable Products Ltd. vs. CTI, 26 ITR 151 (Bom.). In the present case, the Assessing Officer as well as the ld. CIT(A) simply discussed the legal principle without adverting to the material facts on record and had not really decided whether the appellant company had set-up of business and ready to commence the business or not. On perusal of the Profit & Loss Account placed at Paper Book i…

Dy. Commissioner of Income Tax, Circle-16(1), Hyderabad vs. Nsl Mining Resources India Private Limited, Hyderabad

ITA 1411/HYD/2019[2016-17]Status: DisposedITAT Hyderabad20 Sept 2022AY 2016-17

Bench: Shri Inturi Rama Rao & Shri Laliet Kumarassessment Year: 2016-17 The Dy.Commissioner Of Vs M/S. Nsl Mining Income Tax, Resources India Private Circle 16(1), Hyderabad. Limited, Hyderabad. Pan : Aadcn0483C. (Appellant) (Respondent) Assessee By: None Revenue By: Sri Kprr Murthy Date Of Hearing: 19.09.2022 Date Of Pronouncement: 20.09.2022

For Appellant: NoneFor Respondent: Sri KPRR Murthy
Section 143(1)Section 143(2)

…TR 354/218 taxman 66/37 taxmann.com 239 (Delhi) it has been held by the Hon'ble High Court that a business is set up when it is established and is ready to commence business. The Hon'ble Bombay High Court in Western India Vegetable Products Ltd. v. CIT (1954) 26 ITR 151 has held that the first purchase of raw material should be considered as the date of setting up of the business. 4.6 Reliance is also placed on the case of DCIT, Circle-2(1), Hyderabad vs. Karvy Global Services Limited pronounced by the Page 3 of 7 Hon'ble IT AT, Hyderabad vide ITA No.1160/Hyd/2012 dated os" June, 2018, wherein it was held that -…

Vatika Hotels Pvt. Ltd., New Delhi vs. DCIT Circle-17(1), New Delhi

In the result, the appeal is partly allowed for statistical

ITA 3987/DEL/2019[2008-09]Status: DisposedITAT Delhi29 Jun 2022AY 2008-09

Bench: Saktijit Dey & Shri Pradip Kumar Kediaassessment Year: 2008-09

Section 147Section 32

…08-09 Officer may be directed to allow depreciation. In support of his contention, learned counsel relied upon the following decisions: 1. CIT vs. Dhoomketu Builders & Developments Pvt. Ltd., 216 Taxman 76 (Del.) 2. Western Vegetable Products Ltd. Vs. CIT, 26 ITR 151 (Bom.) 3. Sarabhai Management Corporation Ltd. Vs. CIT, 102 ITR 25 (Guj.) 4. Saurashtra Cement and Chemicals Ltd. 91 ITR 170 (SC) 5. CIT Vs. L.G. Electronics (I) Ltd. 282 ITR 545 (Del.) 6. CIT Vs. Hughes Escorts Communications Ltd., 311 ITR 253 (Del.) 7. Carefour WC & C India P. Ltd. Vs. Dy. CIT [2014] 368 ITR 692 (Delhi); 8. Omniglobe Information…

Rbl Hotels Pvt Ltd(Formerly Known Ys Lebara Hotels Pvt Ltd, Chennai vs. ACIT, Corp Cir-4(1), Chennai

The appeal stands allowed

ITA 3429/CHNY/2018[2013-14]Status: DisposedITAT Chennai08 Jun 2022AY 2013-14

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri S. Aravindan & Shri. PawanFor Respondent: Shri Sajit Kumar (JCIT) –Ld. DR
Section 143(3)Section 2(34)Section 3Section 71(1)

…. (203 CTR 587); the decision of Hon’ble Delhi High Court in CIT V/s Samsung India Electronics Ltd. (356 ITR 354) & Carefour WC&C India Pvt. Ltd. V/s DCIT (368 ITR 692); the decision of Hon’ble High Court of Bombay in Western India Vegetable Products V/s CIT (26 ITR 151) besides various other decisions of Tribunal. The Ld. DR, on the other hand, submitted that setting up of business would mean group of activities which would make assessee completely ready to carry out business operations. Till the time the assessee is not ready to commence the business, the expenditure could not be allowed and the same would rema…

Rbl Hotels Pvt Ltd(Formerly Known Ys Lebara Hotels Pvt Ltd, Chennai vs. ACIT, Corp Cir-4(1), Chennai

The appeal stands allowed

ITA 3428/CHNY/2018[2012-13]Status: DisposedITAT Chennai08 Jun 2022AY 2012-13

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri S. Aravindan & Shri. PawanFor Respondent: Shri Sajit Kumar (JCIT) –Ld. DR
Section 143(3)Section 2(34)Section 3Section 71(1)

…. (203 CTR 587); the decision of Hon’ble Delhi High Court in CIT V/s Samsung India Electronics Ltd. (356 ITR 354) & Carefour WC&C India Pvt. Ltd. V/s DCIT (368 ITR 692); the decision of Hon’ble High Court of Bombay in Western India Vegetable Products V/s CIT (26 ITR 151) besides various other decisions of Tribunal. The Ld. DR, on the other hand, submitted that setting up of business would mean group of activities which would make assessee completely ready to carry out business operations. Till the time the assessee is not ready to commence the business, the expenditure could not be allowed and the same would rema…

Orient Green Power Co. Ltd., Chennai vs. ACIT, Chennai

The appeals stands allowed

ITA 1216/CHNY/2017[2010-11]Status: DisposedITAT Chennai01 Apr 2022AY 2010-11

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri R. Sivaraman (Advocate) – Ld. ARFor Respondent: Shri P. Sajith Kumar (JCIT) –Ld. DR
Section 143(3)

…the business is set-up, the expenditure would be allowable notwithstanding the fact that no business income was earned by the assessee during the year. 8. As per the decision of Hon’ble Bombay High Court in the case of Western India Vegetable Products v. CIT 26 ITR 151 (Bom.), what is to be considered is the set-up of the business and not the commencement of business. Quite clearly, the two-term ‘setting-up’ and ITA No.1215 & 1216/Chny/2017 ‘commencement of business’ carries different connotations. What is to be seen is whether the business is set-up or not whereas actual commencement of business may or may not…

Orient Green Power Co. Ltd., Chennai vs. ACIT, Chennai

The appeals stands allowed

ITA 1215/CHNY/2017[2009-10]Status: DisposedITAT Chennai01 Apr 2022AY 2009-10

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri R. Sivaraman (Advocate) – Ld. ARFor Respondent: Shri P. Sajith Kumar (JCIT) –Ld. DR
Section 143(3)

…the business is set-up, the expenditure would be allowable notwithstanding the fact that no business income was earned by the assessee during the year. 8. As per the decision of Hon’ble Bombay High Court in the case of Western India Vegetable Products v. CIT 26 ITR 151 (Bom.), what is to be considered is the set-up of the business and not the commencement of business. Quite clearly, the two-term ‘setting-up’ and ITA No.1215 & 1216/Chny/2017 ‘commencement of business’ carries different connotations. What is to be seen is whether the business is set-up or not whereas actual commencement of business may or may not…

DCIT, Chennai vs. Pvp Ventures Ltd., Chennai

In the result, both the appeals filed by the Revenue are dismissed

ITA 2308/CHNY/2014[2004-05]Status: DisposedITAT Chennai22 Feb 2022AY 2004-05

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwal

For Appellant: Shri M. Rajan, CITFor Respondent: Shri B. Ramakrishnan, FCA
Section 143(3)Section 28

…. The question whether a business has been set up or not is always a question of fact which has to be decided on the facts and in the circumstances of each case." 11. The following observations of Chagla C. J. in Western India Vegetable Products' case [1954] 26 ITR 151, 158 (Bom) were quoted with approval : "That is why it is important to consider whether the expression used in the Indian statute for setting up a business is different from the expression Mr. Justice Rowlatt was considering, viz., 'commencing of the business'. It seems to us that the expression 'setting up' means, as is defined in the Oxford Eng…

DCIT, Chennai vs. Pvp Ventures Ltd., Chennai

In the result, both the appeals filed by the Revenue are dismissed

ITA 1707/CHNY/2013[2006-07]Status: DisposedITAT Chennai22 Feb 2022AY 2006-07

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwal

For Appellant: Shri M. Rajan, CITFor Respondent: Shri B. Ramakrishnan, FCA
Section 143(3)Section 28

…. The question whether a business has been set up or not is always a question of fact which has to be decided on the facts and in the circumstances of each case." 11. The following observations of Chagla C. J. in Western India Vegetable Products' case [1954] 26 ITR 151, 158 (Bom) were quoted with approval : "That is why it is important to consider whether the expression used in the Indian statute for setting up a business is different from the expression Mr. Justice Rowlatt was considering, viz., 'commencing of the business'. It seems to us that the expression 'setting up' means, as is defined in the Oxford Eng…

M/S E-Land Systems Private Limited, Bangalore vs. Income Tax Officer Ward-2(1)(4), Bangalore

In the result, the appeal filed by the assessee is partly allowed

ITA 3163/BANG/2018[2015-16]Status: DisposedITAT Bangalore22 Feb 2022AY 2015-16

Bench: Shri N.V. Vasudevan & Shri B.R. Baskaranassessment Year : 2015-16

For Appellant: Shri Sandeep Chalapathy, A.RFor Respondent: Shri Sankar Ganesh K., D.R

…ITA No.3163/Bang/2018 M/s. E Land Systems Pvt. Ltd., Bangalore IN THE INCOME TAX APPELLATE TRIBUNAL “A’’ BENCH: BANGALORE BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT AND SHRI B.R. BASKARAN, ACCOUNTANT MEMBER Assessment Year : 2015-16 E-Land Systems Pvt. Ltd. No.#6B, 6th Floor Shobha Pearl Opposite Mayo Hall ITO Ward-2(1)(4) Vs. Commissariat Road Bangalore Bangalore 560 025 PAN NO : AADCE8309G APPELLANT RESPONDENT Appellant by : Shri Sandeep Chalapathy, A.R. Respondent by : Shri Sankar Ganesh K., D.R. Date of Hearing : 21.02.2022 Date of Pronouncement : 22.02.2022 O R D E R PER B.R. BASKARAN, ACCOUNTANT M…

ACIT 10(1), Mumbai vs. Fullerton Enterparises P. Ltd, Mumbai

The appeal stand dismissed in terms of our above order

ITA 5523/MUM/2010[2006-07]Status: DisposedITAT Chennai21 Feb 2022AY 2006-07

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri GSD Babu (Advocate) – Ld. ARFor Respondent: Ms. R. Helen Ruby Jesintha (Addl. CIT) –Ld. DR
Section 143(3)

…in this regard were already furnished to Ld. AO during the course of assessment proceedings. Reliance was placed on various judicial decision, notable amongst the same was the decision of Hon’ble High Court of Bombay in Western India Vegetable Products Ltd. (26 ITR 151). The assessee also pointed out other factors which would indicate that the business had already set-up during the year and the expenditure were allowable u/s 37(1) of the Act. 5. The Ld. CIT(A) noted that the AO’s conclusion was based only on Auditor’s Remarks in the Audit Report. However, in the Audit Report, it was mentioned that the assessee h…

ITO Corporate Ward 1(3), Chennai vs. C.S.Housing Property Development Pvt. Ltd., Chennai

Accordingly, the order of the learned Commissioner of Income Tax (Appeals) is confirmed and the appeal of the Revenue in I.T.A No.2427/Chny/2018 is dismissed

ITA 2427/CHNY/2018[2012-13]Status: DisposedITAT Chennai25 Jan 2022AY 2012-13

Bench: Shri V. Durga Rao & Shri G. Manjunatha

For Appellant: Mr. AR.V. Sreenivasan, Addl. CITFor Respondent: Mr. R. Sivaraman, Advocate
Section 143(3)Section 147Section 148Section 35D

…on as to when a business can be said to have been set-up is the judgement of the Hon’ble Bombay High Court speaking through the Chief Justice Chagla, in the case of Western India Vegetables Products Limited Vs. Commissioner of Income Tax reported in (1954) 26 ITR 151. The Court made the following observation which is worth quoting: “It seems to us, that the expression setting up means, as is defined in the Oxford English Dictionary, to place on foot or to establish and in contradiction to commence. The distinction is this that when a business is established and is ready to commence business then it can be sa…

Mmrf Reality and Infrastructure Pvt Ltd, Chennai vs. DCIT Corporate Circle 4 (1), Chennai

In the result, the assessee’s appeal is partly allowed

ITA 627/CHNY/2018[2012-13]Status: DisposedITAT Chennai24 Jan 2022AY 2012-13

Bench: Shri V. Durga Rao & Shri Manoj Kumar Aggarwalआयकर अपील सं./I.T.A. No.627/Chny/2018 िनधा"रण वष"/Assessment Year: 2012-13 Mmrf Realty & Infrastructure Pvt. The Deputy Commissioner Of Vs. Ltd., No. 21, Indira Nagar, Income Tax, 1St Avenue, Adyar, Corporate Circle -4(1), Chennai – 600 020. Chennai. [Pan: Aahcm1575E] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri I. Dinesh, Advocate ""थ" की ओर से/Respondent By : Shri G. Johnson, Addl. Cit सुनवाई की तारीख/ Date Of Hearing : 04.01.2022 घोषणा की तारीख /Date Of Pronouncement : 24.01.2022 आदेश /O R D E R Per V. Durga Rao: The Appeal Filed By The Assessee Is Against The Impugned Order Of The Ld. Commissioner Of Income Tax (Appeals) 8, Chennai Dated 20.12.2017 In Ita No. 162/15-16 For The Assessment Year 2012-13. 2. The Assessee Has Raised The Following Grounds Of Appeal: 1. The Order Of The Commissioner Of Income Tax (Appeals) Enhancing The Assessment Is Wrong, Illegal, Unjust, Arbitrary & Is Liable To Set Aside.

For Appellant: Shri I. Dinesh, AdvocateFor Respondent: Shri G. Johnson, Addl. CIT
Section 143(3)Section 35D

…ion 3 of the Act does not speak of commencement of business but only of setting up of the business. The question is to when the business has to be said to have been set up has been laid down in Bombay High Court in Western India Vegetable Products Ltd vs. CIT 26 ITR 151. "It seems to us, that the expression setting up means, as is defined in the Oxford English Dictionary, to place on foot or to establish, and in contradiction to commence. The distinction is this that when a business is established and is ready to commence business then it can be said of that business that it is set up. But before it is ready to c…

ACIT, Circle - 2(1), Kolkata vs. Tcg Urban Infrastructure Holdings Pvt Ltd., Kolkata

Accordingly, the same is dismissed

ITA 2584/KOL/2019[2004-05]Status: DisposedITAT Kolkata26 Oct 2021AY 2004-05

Bench: Shri Sanjay Garg & Dr. M.L.Meenaआयकर अपील सं.य/

Section 36Section 36(1)(iii)

…inished products have to be undertaken, but business commences when tile first of such activities is taken. (Para 7] Thus, the claim of assessee was to be allowed as business expenditure. CASES REFERRED TO Western India Vegetables Products Ltd. v. CIT [1954] 26 ITR 151(Bom.) (para 4), CWT v. Ramaraju Surgical Cotton Mills Ltd. [1967] 63 ITR 478(SC) (para) 4, Sarabhai Management Corpn. Ltd. v. CIT [1991] 192 ITR 151 (SC) (para 4), CIT v. L.G. Electronics (India) Ltd. [2006] 282 ITR 545/[2005] 149 Taxman 166 (Delhi) (para 7) and CIT v, ESPN Software India (P.) Ltd. [2008] 301 !TR 368/[2009] 184 Taxman 452 (Delhi)…

ACIT 3(1)(2), Mumbai vs. Experian Credit Information Co. P.Ltd, Mumbai

Appeals of the Revenue stands dismissed

ITA 805/MUM/2017[2011-12]Status: DisposedITAT Mumbai02 Aug 2021AY 2011-12

…ng up of business, what is required is readiness for commencement of business and actual commencement of business would not be necessary."[Para 10] 5.2.14 The above decision took into consideration ratios of Western India Vegetable Products Ltd. v. C/T[1954] 26 ITR 151 (Bom.) (para 10), CITv. 9 M/s. Experian Credit Information Company Pvt. Ltd. Ralliwolf Ltd. [1980J 121 ITR 262 (Bom.) (para 10), CIT Vs. Saurashtra Cement & Chemical Industries Ltd. [1973] 91 ITR 170 (Guj.) (para 10) and DHL Express (I) (P.) Ltd. v. Asstt CIT (2009) 124 TTJ 108 (Mum.) (para 10.1). 5.2.15 Questions such as lack of 3rd party/vendo…

Maruti Insurance Broking Pvt Ltd vs. Deputy Commissioner of Income Tax

The appeal is allowed in the aforesaid terms

ITA/17/2021HC Delhi12 Apr 2021
For Appellant: - ........................................................ 5For Respondent: - ............................................................. 6
Section 260ASection 3

…Court rendered in CIT vs. Whirlpool of India Ltd., 318 ITR 347 (Del). Mr. Vohra also relied upon the decisions rendered in CIT v. Dhoomketu Builders & Development (P.) Ltd., [2014] 368 ITR 680 (Del) and Western India Vegetable Products Ltd. v. CIT [1954] 26 ITR 151 (Bom). 3.1. In addition to the aforesaid, Mr. Vohra also drew our attention to the fact [something which we have already noticed hereinabove while capturing the backdrop of the case], that in the earlier AY, i.e., A.Y. 2011-2012, the assessee had filed a loss return, which was accepted by the revenue. It is Mr. Vohra‟s argument that, since…

Gco Technologies Centre P.Tld, Mumbai vs. ITO 9(1)(4), Mumbai

The appeal of the assessee is partly allowed in terms of our aforesaid observations

ITA 6310/MUM/2014[2010-11]Status: DisposedITAT Mumbai05 Nov 2020AY 2010-11

Bench: Shri Pramod Kumar & Shri Ravish Soodm/S Gco Technologies Centre Ito-9(1)(4) Private Limited, Mumbai Office No. 227, 2Nd Floor, Vs. Hari Om Plaza, M.G. Road, Borivali (E) Mumbai – 400066 Pan – Aadcg4414E (Appellant) (Respondent)

For Appellant: Shri Devendra Jain, A.RFor Respondent: Shri Akhtar Hussain Ansari, D.R
Section 143(1)Section 143(2)Section 143(3)Section 35DSection 37(1)Section 92C

…igh Court of Bombay in the case of CIT Vs. Axis Private Equity Limited [ITA No. 1204 of 2014, dated 30.01.2017]. In its aforesaid order, the Hon‟ble High Court relying on its earlier judgment in the case of Western India Vegetables Products Ltd. Vs. CIT(1954) 26 ITR 151 (Bom), had held, that business is said to have been „set up‟ when it is established and ready to commence. As observed by the High Court, there may be an interval between a business which is „set up‟ and a business which is commenced. However, all expenses incurred during the interregnum period between „setting up‟ of business and commencement of…

M/S Bengal Shriram Hitech City Private Limited, Bangalore vs. Income Tax Officer Ward-1(1)(3), Bangalore

In the result, all the appeals of the assessee are treated as partly allowed

ITA 122/BANG/2019[2014-15]Status: DisposedITAT Bangalore12 Oct 2020AY 2014-15

Bench: Shri B. R. Baskaran & Smt. Beena Pillaiassessment Year: 2012 – 13

For Appellant: Shri S. Ananthan, A.RFor Respondent: Shri Mallikarjuna G., D.R

…art business it can be said to be set up. The business must be put into such a shape that it can start functioning as a business manufacturing organization. The Gujarat High Court, relying upon the decision in Western India Vegetable Product Ltd. v. CIT119541 26 ITR 151 (Boni.) and the decision of Supreme Court in CWT v. Ramaraju Surgical Cotton Mills Ltd. [1967] 63 ITR 478, observed : ". . . the new business which was sought to be established by the assessee was a business of manufacturing scientific instruments and communication equipment and it could not be said to be ready to discharge the function for which…

M/S Bengal Shriram Hitech City Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-1(1)(2), Bangalore

In the result, all the appeals of the assessee are treated as partly allowed

ITA 121/BANG/2019[2013-14]Status: DisposedITAT Bangalore12 Oct 2020AY 2013-14

Bench: Shri B. R. Baskaran & Smt. Beena Pillaiassessment Year: 2012 – 13

For Appellant: Shri S. Ananthan, A.RFor Respondent: Shri Mallikarjuna G., D.R

…art business it can be said to be set up. The business must be put into such a shape that it can start functioning as a business manufacturing organization. The Gujarat High Court, relying upon the decision in Western India Vegetable Product Ltd. v. CIT119541 26 ITR 151 (Boni.) and the decision of Supreme Court in CWT v. Ramaraju Surgical Cotton Mills Ltd. [1967] 63 ITR 478, observed : ". . . the new business which was sought to be established by the assessee was a business of manufacturing scientific instruments and communication equipment and it could not be said to be ready to discharge the function for which…

Bengal Shriram Hitech City Pvt Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-2(1)(1), Bangalore

In the result, all the appeals of the assessee are treated as partly allowed

ITA 1341/BANG/2017[2012-13]Status: DisposedITAT Bangalore12 Oct 2020AY 2012-13

Bench: Shri B. R. Baskaran & Smt. Beena Pillaiassessment Year: 2012 – 13

For Appellant: Shri S. Ananthan, A.RFor Respondent: Shri Mallikarjuna G., D.R

…art business it can be said to be set up. The business must be put into such a shape that it can start functioning as a business manufacturing organization. The Gujarat High Court, relying upon the decision in Western India Vegetable Product Ltd. v. CIT119541 26 ITR 151 (Boni.) and the decision of Supreme Court in CWT v. Ramaraju Surgical Cotton Mills Ltd. [1967] 63 ITR 478, observed : ". . . the new business which was sought to be established by the assessee was a business of manufacturing scientific instruments and communication equipment and it could not be said to be ready to discharge the function for which…