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2016 (11) TMI 1388 - AT - Income TaxIncome from share transactions - ‘Short Term Capital Gains’ OR ‘Business Income’ - Held that:- A perusal of details of transactions entered by assessee in Scrip ‘Jain Irrigation’ shows that the assessee earned income of ₹ 14.75 Lacs on turnover of ₹ 195.86 Lacs with high frequency of transactions in this particular scrip. The holding period ranges from 0 days to 30 days. The assessee has purchased the scrip in 37 days and sold the scrip in 27 days. The frequency and repetitive nature of transaction in one single scrip shows a clear profit motive on the part of the assessee and negates its contention that the assessee has indulged in investment activity. A substantial relief has already been provided by CIT(A) with respect to balance amount. Therefore, we find no infirmity in the order of CIT(A) and dismiss this ground of appeal of the assessee. Section 14A disallowance - Held that:- No calculations have been provided by AO so as to arrive at the figures of ₹ 1,65,595/- in the assessment order. As per Ld. AR, the assessee agitated the matter before CIT(A) but the same was not considered. Further, the Ld. AR has contended that this disallowance, if any, has to be made then it should be restricted to amount of dividend earned by the assessee. Therefore, we deem it fit to restore the matter back to the file of AO for limited purpose to recompute 14A disallowance and restrict the same to the extent of tax free income earned by the assessee. The assessee is directed to cooperate with the AO to supply necessary information / documents forthwith to substantiate his claim in this regard failing which AO shall be at liberty to compute the same on the basis of material available on record. This ground of assessee is partly allowed.
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