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2019 (6) TMI 1209 - AT - Income TaxDisallowance u/s 14A - disallowance on investment held stock in trade - AO made at the rate of 2.75% of exempt income as done in past - HELD THAT:- As in assessee’s own case for A.Y. 2010-11, 2011-12 & 2013-14 [2018 (4) TMI 1723 - ITAT MUMBAI] several more decisions have come which have upheld the view that disallowance u/s 14A is not required when the investment is held as stock in trade. In our considered opinion we should follow the doctrine of stare decisis. Accordingly following the same directions as above we remit this issue to the file of the AO. Recently in Maxopp Investment Ltd. Vs Commissioner of Income-tax [2018 (3) TMI 805 - SUPREME COURT] has held that in cases, where shares are held as stock-in-trade, main purpose is to trade in those shares and earn profits therefrom, in the process, certain dividend is also earned, though incidentally, which is also an income. This triggers applicability of section 14A which is based on theory of apportionment of expenditure between taxable and non-taxable income. Therefore, to that extent, expenditure incurred in acquiring those shares will have to be apportioned - this ground of appeal is restored to the file of Assessing Officer for deciding the issue afresh Income accrued in India - Taxability in India - Exclusion of income of foreign branches situated in countries where there is double tax avoidance agreement based on Article 7 of the respective agreements which provides that business profits is to be taxed in respective countries - HELD THAT:- The issue has been decided against the assessee by the ITAT in assessee’s own case for A.Y. 2011-12 income of the foreign branches of the assessee shall also be taxable in India, that is, it would be included in the return income filed by the assessee in India and whatever taxes have been paid by the branches in the other countries credit of such taxes shall be given. Disallowance of broken period interest - HELD THAT:- We find that identical issue has been decided in favour of the assessee by Hon'ble Supreme Court in the case of Citibank [2008 (8) TMI 766 - SUPREME COURT] and HDFC Bank Ltd. [2014 (8) TMI 119 - BOMBAY HIGH COURT] following these decisions ITAT in assessee’s own case for A.Y. 2011-12 allowed the claim of the assessee and dismissed the Departmental appeal . Disallowance of provisions of wages arrear - HELD THAT:- As in assessee’s own case for A.Y. 2010-11 deleted the similar disallowance. Claim of amortization of lease premium - CIT (A) wrongly decided on the issue of amortisation of Investment when there was no such issue in the assessment order - assessee pray for direction of CIT (A) should be directed to decide on allowability of amortization of lease premium paid - HELD THAT:- The respondent presently seeks leave of the Hon'ble ITAT to persue the grounds for amortization of lease premium paid which were a part of appeal before learned CIT(A) to support the claim of the Respondent as per Rule 27 of Income-Tax (Appellate Tribunal) Rules, 1963. CIT(A) ought to have decided on the issue of allowabiltiy of amortisation of lease premium as prayed for in grounds of appeal before Id CIT (A) - remanded to CIT(A)
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