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2015 (10) TMI 1879 - AT - Income TaxTreatment to long term capital gain and short term capital gain loss - CIT(A) directing AO not to treat the long term capital gain and short term capital gain loss as speculation transactions - Held that:- No infirmity in the conclusion of the ld. Commissioner of Income Tax (Appeals) because there is no positive income available for taxation for the current year and even if, these are held to be speculative transactions, the loss was required to be set off against the profit during the year itself as per sub-section 1 to section 73. However, we are in agreement with the finding of the ld. Commissioner of Income Tax (Appeals) that the LTCG and STCG were not speculative transactions. - Decided against revenue. Addition of the apportioned expenditure towards speculation activity - CIT(A) deleted part addition - Held that:- As we have upheld the stand of the ld. Commissioner of Income Tax (Appeals) that such gains/losses were not speculative transaction, thus, under these circumstances, allocation of expenses was not required. The Assessing Officer treated the allocation of expenses to be speculative activity of the assessee on the basis of percentage of income/profit. Ultimately, it is the turnover, which requires incurring of expenses, thus, we are in agreement with the finding of the ld. Commissioner of Income Tax (Appeals) that the allocation of expenses was required to be made on the basis of turnover as offered by the assessee because the assessee itself considered stamp duty expenses of ₹ 1,00,729/-, transaction charges of Rs, 51,832/- and STT of ₹ 5,23,542/- as expenses, thus, we find no infirmity in directing to consider stamp duty expenses, STT and transaction charges/additional expenses pertaining to speculation activity granting part relief to the assessee. The stand of the ld. Commissioner of Income Tax (Appeals) is affirmed.- Decided against revenue. Re-work the disallowances made u/s 14A by excluding the stock in trade from the value of investments as directed by CIT(A) - Held that:- Without going into much deliberation, we note that under the facts available on record to this limited extent, we are in agreement with the ld. DR/Assessing Officer that the provision of section 14A read with Rule-8D of the Rules are applicable. The Tribunal, in the case of Dy.CIT vs Damani Estates and Finance Pvt. Ltd. (2013 (8) TMI 457 - ITAT MUMBAI) has clarified that Rule 8D shall apply qua the shares held as stock-in-trade. The Tribunal has, therefore, in effect confirmed its earlier order, passed by its Special Bench, in ITO vs Daga Capital Management Pvt. Ltd. (2008 (10) TMI 383 - ITAT MUMBAI). However, the Tribunal has clarified that the disallowance in respect of proportionate interest shall be restricted to 20% of such interest. Subject to this modification, we confirm the application of section 14A read with Rule-8D - Decided partly in favour of revenue
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