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2016 (9) TMI 905 - AT - Income TaxDisallowance under Sec. 14A Rule 8D - Held that:- We have considered the business activities, financial statements and judicial decisions, there seems to be a realistic approach on acquisition of shares by the assessee company and the above expenditure was incurred purely on the investment strategies of the Business. Therefore, the ld. Assessing Officer should have considered the expenditure from the assessee business objects and activities and the calculate the disallowance under Sec. 14A Rule 8D. We, therefore are of the opinion that the disputed issue has to be re-examined in line with the investment activity by the ld. Assessing Officer and we set aside the order of the Commissioner of Income Tax (Appeals) to the file of the ld. Assessing Officer for examination and the assessee shall be provided adequate opportunity of hearing before passing the orders on merits and the ground of the assessee is allowed for statistical purpose. Short Term Capital Loss on claim of forfeiture of warrants - Held that:- All documents or transactions have to be given effect to even though they resulted in reduction of tax liability, provided that they are genuine and bona fide and it cannot be called as colourable device. In case, a transaction took place with the sole intention to defraud Revenue and that resulted in deduction of tax liability, it can be called as a dubious method followed by the assessee, as the parties involved therein have no right to indulge any tax evasion and it cannot be taken away by any judgment of the Court. This has to be considered and in fairness, it should be appreciated that all transactions, which resulted in evasion of tax liability, can be considered as a device or subterfuge or colourable transaction. We found on perusal of the share warrant certificate and the financial statements and the assessment order, the ld. Assessing Officer in his order is silent on this transaction of financial statement of Shriram City Union Finance Limited and accounting system. Therefore, we set aside order of the Commissioner of Income Tax (Appeals) order and remit the disputed issue to the file of ld. Assessing Officer for re-examination based on the information submitted on warrants and financial statement of Shriram City Union Finance Limited and the Assessing Officer shall pass the order on merits after providing opportunity of being heard in accordance with law. The ground of the assessee is allowed for statistical purpose. Exclude addition u/sec. 14A for calculating of Book profit u/s.115JB of the Act and allow the appeal of the assessee.
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