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2017 (9) TMI 378 - AT - Income TaxAddition u/s 14A - Held that:- If there is no exempt income, disallowance u/s 14A not to be made. See Cheminvest Ltd. Vs CIT [2015 (9) TMI 238 - DELHI HIGH COURT]. Loss on sale of mutual funds - capital loss OR business loss - mutual funds held as stock in trade - Held that:- It is undisputed fact that the loss has been incurred during the normal course of the business. Since the assessee's only source of income was his interest and in this view the loss incurred on the sale of mutual fund has to be held as business loss. Therefore, this issue is covered by the judgment of the Hon'ble Supreme Court in the case of CIT vs Cocanada Radhaswami Bank Ltd. (1965 (4) TMI 11 - SUPREME Court) wherein it was held that since the entire income of the assessee include interest on securities, the assessee was entitled to set off such losses out of its business income. We also note that AO cannot dispute that the loss arising from sale of investment will be capital gain as against business loss claimed by the assessee. The same stand was followed by the assessee in the earlier years and there is no addition made by the AO in the earlier and succeeding years. Thus addition deleted. Assessee appeal allowed.
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