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2009 (2) TMI 481 - HC - Income TaxShame Transactions - the arrangement was not collusive or that the mutual fund had not provided accommodation entries to the assessee to purchase a loss. It is not disputed that the mutual fund has an approval from the Securities and Exchange Board of India (SEBI). Furthermore, nothing has been brought on record to show that the transaction between the assessee and the mutual fund was not an arm's length transaction. Dividend Stripping - at the relevant time there was no provision under the Act which could be invoked to disallow a loss of the nature incurred by the assessee. As correctly held by the Tribunal the provisions of section 94(7) of the Act were inserted in the Act with effect from April 1, 2002 and hence, would impact, if at all, transactions undertaken in the assessment year 2002-03. Section 14A - There is no whisper of any expenditure either in the assessment order or in the order of the Commissioner of Income-tax (Appeals) with respect to expenditure which the assessee incurred for earning income i.e., dividends from units which are admittedly exempted under section 10(33) of the Act. Nothing has also been indicated in the appeal which would lead us to believe that there was material which could have been looked into had the Tribunal permitted the Revenue to take up the said additional ground pertaining to section 14A of the Act.
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