Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (8) TMI 368 - ITAT MUMBAIDisallowance of loss incurred on sale of investment - Bogus purchase - CIT upheld disllowance - Held that:- The assessee has filed each and every detail before the AO. The purchase price of shares of was paid through proper banking channel, which were purchased in the year 1996-97. Investments were shown in the balance sheet of the assessee. The investment made in the financial year 1996-97 was not doubted as the assessment for assessment year 1997-98 was completed under Section 143(3) - CIT(A) merely observing that the assessee could not file any further evidence in respect of claim of loss, has rejected the claim of the assessee. Once all relevant details are on record, then learned CIT(A) should have considered all these details on merit and the decision should have taken as to whether the loss is allowable or not - Decided in favour of assessee. Capital receipt of Revenue receipt - swap income from forward contract in foreign currency - CIT held income as capital receipt - Held that:- the income earned in the account of swapping of forward rate contract of foreign currency booked for the purpose of capital assets for its Jamnagar refinery project, was earned on account of contract for buying the capital asset. The explanation to Section 43A is also applicable on the facts of the present case - if the foreign exchange loss is on account of purchase of capital asset, then it goes to capital account and if the loss is on account of loan for working capital, then it goes to revenue account - Following decision of Commissioner Of Income-Tax Versus Bharat Heavy Electricals Ltd. [1999 (8) TMI 62 - DELHI High Court] and Sutlej Cotton Mills Limited Versus Commissioner of Income-Tax, West Bengal [1978 (9) TMI 1 - SUPREME Court] - Decided in favour of assessee. Disallowance u/s 14A - Held that:- The demat account relates to purchase and sale of shares. The assessee himself has accepted that there is dividend income which is exempt to tax. The demat account was opened for the purpose of holding the shares in a particular account as per guidelines of the appropriate authority. On opening the demat account etc., the amounts were incurred on that directly linked with purchase and sale of shares on which dividend income is earned, which is exempt to tax. Therefore, it cannot be said that these expenses are for any other purpose and not related to exempted income. If the shares are purchased and sold and they are kept in a particular account and any expenditure incurred on account of that account, it has to be taken that they are directly linked with the purchase and sale of shares - expenses incurred on demat account is directly linked with the earning of exempted income. Accordingly, the provisions of Section 14A are applicable - Rule 8D is prospective in nature - Decided against assessee. Computation of gross total income – manner of claiming special deduction under chapter VI-A – deduction of depreciation allowance – Held that:- quantum of deduction under Section 80IA is not dependent upon the assessee claiming or not claiming depreciation, because, under Section 80IA the quantum of deduction has to be determined by computing total income from business after deducting all deductions allowable under Section 30 to 43D of the Act - for the purposes of deduction under Chapter VIA, the gross total income has to be computed inter alia by deducting the deductions allowable under section 30 to 43D of the Act, including depreciation allowable under section 32 of the Act, even though the assessee has computed the total income under Chapter IV by disclaiming the current depreciation - Following decision of Plastiblends India Limited Versus Additional Commissioner of Income-Tax [2009 (10) TMI 39 - BOMBAY HIGH COURT] - Decided against assessee. Penalty under Section 271(1)(c) - Held that:- penalty on the amount of disallowance under Section 14A is not leviable because the assessee has furnished each and every detail. This is assessee's claim that demat charges are for the purpose of holding the shares, which is a source of income but not directly link with the exempted income - at least penalty on this amount is not leviable as there was no case of furnishing inaccurate particulars. This is a claim of assessee whether the same is allowable or not allowable, is the subject matter of dispute - Decided in favour of assessee.
|