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2017 (5) TMI 1644 - AT - Income TaxClassification of income - Income from share transactions - business income OR capital gain - Period of holding - Held that:- Assessee has chosen to treat the shares held for more than 30 days under the head ‘investment’. The assessee has sufficient owned capital to make these investments. The dealings are primarily in listed securities and the assessee has undertaken delivery based transactions, albeit for shorter period of time, average holding period being 72 days. Although, we are conscious of the fact that the principal of res judicata do not apply to Income Tax proceedings, yet we are of the view that there ought to be uniformity in treatment and consistency when the facts and circumstances are identical. Moreover, latest CBDT Circular No.6/2016 which is clarificatory in nature applies to listed securities and directs AO not to disturb the stand taken by assessee provided the same is applied consistently - their cannot be any straight jacket formula to distinguish the same and further there cannot be any single decisive factor to determine the same but an overall view has to be taken keeping in mind peculiar facts and circumstances of the case. We find ourselves in agreement with the view taken by CIT(A) that Appellant has carried out trading in shares as well as earned capital gains income on sale of shares which were held as investment. Accordingly, the treatment of gains as business income. Disallowance u/s 14A - Held that:- Upon perusal of financial statement of the assessee, we find that the assessee has debited administrative expenditure of ₹ 3,45,491/- which is the maximum disallowance which the assessee can suffer. However, Ld. AO has made disallowance of ₹ 6,25,414/- towards the same which is not justified. Therefore, we delete disallowance of ₹ 3,45,391/- made u/r 8D(2)(i) while confirm the addition of ₹ 2,79,923/- made u/r 8D(2)(iii). This ground of revenue’s appeal partly succeeds.
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