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2013 (4) TMI 940 - AT - Income TaxCorrect head of income - Income from sale of shares - capital gain or business income - HELD THAT:- The Tribunal being a fact finding body, it was not the case of the AO to form an opinion as to how to conduct the share business when the assessee is dealing in shares and held as investment in shares which holding is not disputed by the AO, in so far as, the shares were held for more than one year was acceptable to it. This was considered in the case of CIT vs Gopal Purohit by ITAT Mumbai [2010 (1) TMI 7 - BOMBAY HIGH COURT] Even the shares purchased in the same year and sold cannot be considered for taxation as business in so far as the assessee had complied with various govt. regulations to hold the shares as per the guidelines of the SEBI cannot be thrust upon the assessee on the sole opinion of the AO to be rendered as business income. The crux of the finding that the assets which have been held as investments have been sold on account of capital and not for business. We are inclined to hold the issue as covered in favour of the assessee, in so far as, the Revenue has not been able to bring out any controverting material which the ld. Counsel for the assessee has submitted that the case laws cited fairly cover the facts which the ld. CIT(A) accepted and allowed the assessee’s appeal who confirmed the returned income on sale of shares as for capital gains. The appeal of the revenue stands dismissed. Disallowance u/s 14A r.w.r. 8D - HELD THAT:- Revenue has not been able to controvert this fact in so far as the ld. CIT(A) in his order computed the exempted income for taxation u/s 14A of the Act by disallowing the expenditure thereto as per Rule 8D was on the basis of not claiming the expenditure but on the earning of income was misconstrued by him when he chose to consider half percentage of interest paid by the assessee to be considered for participating in the earning of exempted income. In this view of the matter enhancement by the ld. CIT(A) is restricted to ₹ 34,944/- in accordance with the said section. This ground raised by the assessee stands partly allowed. Expenditure disallowed as the earning of sale of investment - whether such expenditure has been incurred for the business of the assessee? - HELD THAT:- assessee for this proposition submitted the balance sheet for impugned assessment years when the claim of the expenditure on dealing of the shares has been allowed and are part and parcel of the assessee’s business when it was nobodys finding that these expenses are not for the business of the assessee. The ld. Counsel for the assessee has submitted that it is a settled principle in so far as computing the capital gains is not to be considered in a confused manner no expenditure is claimed to reduce the capital gains for reducing the consideration. We do find the contention of the ld. Counsel for the assessee justifiable in so far as the Revenue has not controverted that the expenditure of the claim for the business of the assessee are only for the business of the assessee and has not been claimed as increase in the cost of shares sold as investment. In this view of the matter this ground of the assessee is allowed and the AO is directed to delete the addition
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