2012 (4) TMI 282 - HC - Income Tax

Dis-allowance of business expenditure assuming it be expenditure falling u/s 14A – assessee dealing in share and securities earned profit on sale and shares and dividend on shares held as stock in trade – proportionate brokerage expenses paid on trading of shares and other business expenditure dis-allowed u/s 14A – Held that:- When the assessee has not retained shares with the intention of earning dividend income and the dividend income is incidental to his business of sale of shares, which remained unsold by the assessee, it cannot be said that the expenditure incurred in acquiring the shares has to be apportioned to the extent of dividend income and that should be disallowed from deductions. When no expenditure is incurred by the assessee in earning the dividend income, no notional expenditure could be deducted from the said income – Decided in favor of assessee.