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2016 (4) TMI 704 - AT - Income TaxDisallowance of fine paid to National Securities Clearing Corporation u/s.37(1) - AR submitted payment as fine is in lieu of non submission charges levied and partially collection of margin and argued that as per the terms of contract with NSCCL such payments are always compensatory in nature - Held that:- We are of the opinion on the basis of the debit note and debit advices though in debit advice it was referred as penalty for initial margin summary statement they take the characteristic of business transaction wholly and exclusively incurred in trading of securities and compensatory in nature. Considering the apparent facts, we set aside the order of Commissioner of Income Tax (Appeals) on this ground and we direct the Assessing Officer to delete the addition - Decided in favour of assessee Disallowance u/Sec 14A - Held that:- The ld. Assessing Officer applying the provisions of Sec.14A r.w.r. 8D(iii) has calculated the disallowance and considered B16,770/- and made an additional disallowance of B2,57,857/-. The ld. Authorised Representative reiterated his submissions and argued that the total exempted income received by the assessee is B88,252/- and assessee has voluntarily disallowed B16,770/- whereas the ld. Assessing Officer calculated disallowance under Rule 8D B2,57,857/- which is at higher side on comparison with income received and prayed deletion. We after considering the apparent facts and judicial decision of M/s.Joint Investments P. Ltd vs. CIT [2015 (3) TMI 155 - DELHI HIGH COURT ] were held that disallowance should be restricted to the extent of exempted income. Therefore, we set aside order of the Commissioner of Income Tax (Appeals) on this ground and remit the issue in dispute to the file of the Assessing Officer, who shall verify and examine the disallowance on the ratio of judicial decision.
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