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2022 (9) TMI 1569 - AT - Income TaxCorrect head of income - income earned by the assessee on share/mutual funds transactions - volume of transaction - HELD THAT:- We note that assessee has purchased the shares on delivery basis. Though the volume of transactions is high and certain borrowed funds have also been deployed but considering the judicial precedents referred above including that of Hon’ble jurisdictional High Court carrying force of binding nature, we have no hesitation in holding that mere volume of transactions and utilization of borrowed funds are not the criterion to alter the treatment given by the assessee about her investment in the books. Therefore, along with the CBDT circulars, we allow the appeal of the assessee and direct the AO to treat the income earned by the assessee on share/mutual funds transactions under the head capital gains by considering the assessee as an investor, whether short-term or long-term capital gains, depending upon the period of holdings of the relevant shares/mutual fund units. In the result, grounds taken on this issue by the assessee are allowed and those by the revenue are dismissed. Disallowance u/s 14A - assessee submitted that it should be restricted to the extent of considering only those investments which yielded exempt income for which a detailed working is placed on record - HELD THAT:- We find it proper to remit the matter back to the file of AO for the limited purpose of verification of the calculations made by the assessee reproduced and accordingly consider the disallowance u/s 14A of the Act.
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