No Business Income

Tax queries 532 views 3 replies

If Any Assessee company is engaged in its business activity , but has no Business Income , Can it Claim carry Forward of Losses under Head PGBP??

Please Reply in Case Laws Refrence.

Thanks in Advance,,

Ankit

Replies (3)

YES, THE BUSINESS LOSS CAN BE CARRIED FORWARD UPTO 8 YEARS IN CASE OF SPECULATION BUSINESSS IT CAN BE CARRIED FORWARD UPTO 4 YEARS

i agree with rajesh. the sections 72 (loss from business) and 73 (loss from speculative business) can be referred.

In this regard it is also important to check whether the business has been set up or not, as expenditure can be claimed as deduction only after the setting up of the business. Consequently, in the absence of any income such deductions become losses and can be carried forward u/s 72 of the IT Act.

 

The Mumbai Tribunal in the case of DHL Express (I) Pvt. Ltd. Vs ACIT (2009) 124 TTJ 108 held that a unit cannot be said to have been set up unless it is ready to discharge the function for which it is being set up. Setting up of business is distinct from commencement of business. It is only when the unit has been put into such a shape that it can start functioning as a business or a manufacturing organization that it can be said that the unit has been set up.  


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