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2017 (11) TMI 181 - AT - Income TaxIncome from hedging transaction of Menthol Oil - whether be treated as a business income for the purpose of section 80IB or not? - Held that:- This year it appears that the assessee incurred loss from hedging contracts in Menthol Oil and the Assessing Officer treated such loss as speculation loss following the stand taken in earlier years that the income from hedging contracts is the income from speculation business. In assessee’s own case the Coordinate Bench in earlier years held that income from hedging contracts is a business income thus respectfully following the said decision we uphold the order of the Ld.CIT(A) in holding that he hedging loss is the business loss in the case of the assessee not a speculation loss. Grounds raised by the Revenue on this issue are dismissed. Disallowance of expenses of Daman Unit - AO disallowed the expenses on the ground that the manufacturing activities of Daman Unit were closed in Financial year 2005-06 and there was complete stoppage of activity - Held that:- This issue came up before the Tribunal for the Assessment Year 2009-10 in assessee’s own case wherein allowed the claim of the assessee holding that, expenses are incurred in the normal maintenance of business which have to be incurred inspite of closer of operations of the unit. We direct the Assessing Officer to allow the said expenditure as deduction in computing the income of the assessee. This ground of appeal is allowed. Disallowance u/s. 14A r.w. Rule 8D(2)(iii) - Held that:- Taking the totality of facts and circumstances into consideration, we direct the Assessing Officer to restrict the disallowance under Rule 8D(2)(iii) to 5% of the dividend income earned by the assessee. In the result the ground raised by the assessee is partly allowed.
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