TMI Blog2014 (7) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... nses – Held that:- The assessee submitted that the working of computation of disallowance and also the expenses which can be said to be directly attributable to the other business activities – CIT(A) was of the view that the AO should disallow the administrative expenditure as per rule 8D(2)(iii), the disallowance should not exceed the total administrative expenditure incurred – there was no infirmity in the order passed by the CIT(A) as the disallowance u/s 14A, cannot exceed the total administrative expenditure debited by the assessee in the Profit & Loss account - Even under the formula given in rule 8D, the disallowance cannot exceed the overall expenditure claimed in the Profit & Loss account – Decided against Revenue. - ITA No. 4578/Mum./2012 - - - Dated:- 25-6-2014 - Shri D. Karunakara Rao And Shri Amit Shukla,JJ. For the Petitioner : Mr. Rajesh Ranjan Prasad For the Respondent : Mr. Vijay Mehta ORDER Per Amit Shukla, J. M. The present appeal has been preferred by the Revenue, challenging the impugned order dated 4th April 2012, passed by the learned Commissioner (Appeals) XXXIX, Mumbai, for the quantum of assessment passed under section 143(3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has borrowed funds to fund his activity for purchase and sale of shares. The presence of borrowed funds imparts the activity the color of trade rather than investment. d) The assessee has not furnished any reason for purchase neither has he furnished the reason for sale. In the absence of a definitive reason on the part of assessee what can be gauged from the facts is that the assessee has bought and sold depending on the volatility of the market. This behaviour resembles that of the trader. e) The assessee has argued that it has recorded the above purchases as investments therefore the income from the same should be treated as capital gains f) The recording in the books of accounts is illuminatory but it is not sacrosanct. The Income from the same can be assessed as business income depending on the facts and circumstances of the case. g) Commodities and scrips. as held by Royal Commission of England are normally tile subject matter of trading and very exceptionally the subject of investment. h) Usually the profits on this property have been realized in a very short duration i) Recording in the Books of accounts are illuminatory and not sacrosanct. j) In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15,06,07,949 40,223 23,924 Average Holding period 15 months to 60 months 13 months to 68 months 281 days 167 days 4 8 days 3 5 days Dividend recd. Recd in FY 08 09; ₹ 30.42 lacs Recd in FY 07 08; ₹ 1.50 crores Recd in FY 08 09 ₹ 12.96 lacs Recd in FY 07 08; ₹ 90.02 lacs N.A. N.A. Recd in FY 07 08 ₹ 1.50 crores Recd in FY 06 07 ₹ 29.27 lacs Recd in FY 07 08 ₹ 90.02 lacs Recd in FY 06 07 ₹ 74,002 5. After incorporating the detail submissions of the assessee as well as the reasoning of the Assessing Officer, the learned Commissioner (Appeals) referred to the discussions made in the appellate order for the assessment year 2008 09 and held that the facts prevailing in the present assessment year are identical and, therefore, on similar grounds and conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f consistency is to be followed. When the facts are same and the law has not changed, we do not find any reason to take a different view as from the past assessment of the assessee. We, therefore, do not find any merit in Revenue s appeal and accordingly the finding of the ld. CIT(A) is confirmed. Ground No.1 of Revenue s appeal is dismissed. 8. In this year also, it is an admitted fact that the reasoning given by the Assessing Officer and the learned Commissioner (Appeals) are akin to that of the earlier years and, therefore, consistent with the view taken by the Tribunal in earlier years, we uphold the finding of the learned Commissioner (Appeals) that the income derived by the assessee from the transactions of the shares is to be taxed under the head capital gain and not income from business . Accordingly, ground no.1, raised by the Revenue stands dismissed. 9. Ground no.2, relates to restriction of disallowance under section 14A, made by the learned Commissioner (Appeals). 10. The assessee has earned long term capital gain of ₹ 4,49,38,696, and dividend income of ₹ 8,04,32,399, which has been claimed as exempt. As regards the direct expenditure incurred ..... X X X X Extracts X X X X X X X X Extracts X X X X
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