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2021 (11) TMI 918 - AT - Income TaxCorrect head of income - income arising out of shares - business income or income from capital gains - HELD THAT:- In this case the assessee has purchased shares of Induslnd Bank on 18.12.2009 and sold the same on 23.03.2011. The holding period of the shares is more than 12 months and only single activity carried by the assessee. In the balance sheet also it has shown as an investment. In view of the above facts, we are of the opinion that the activity carried by the assessee cannot be treated as a business activity. As laid down in the CBDT circular No. 4/2007, the substantial nature of transactions and the manner of maintaining books of accounts plays an important role in determining the nature of transaction. Also, as depicted by the Circular No. 06/2016, in the present case, the appellant has treated the shares as investment and not as stock-in-trade and there are no fine grounds to say that the appellant is a dealer in shares and not an investor especially when the sale of shares was a single solitary transaction - Decided against revenue. Disallowance u/s. 14A - assessee has disallowed an amount suo-moto as expenses attributable to the earning of the exempt dividend income - HELD THAT:- We find that the Ld. CIT(A) only directed the A.O. to verify entire investments and exclude investments which has no exempt income yielded and direct the A.O. to re-compute disallowance of Rule 8D(2)(iii) of the Rules r/w s. 14A of the Act. Hence, we find no infirmity in the order passed by the Ld. CIT(A). Disallowance of Board meeting expenditure - assessee has conducted a Board meeting at Chennai on various dates and has incurred the above expenditure towards travelling, boarding, lodging, credit card expenditure AND that the assessee's registered office is situated in Delhi, there is no purpose of holding the Board meeting in Chennai - CIT-A deleted the addition - HELD THAT:- We find that when the assessee is having subsidiary and associated offices in Chennai and some of the Directors are staying at Chennai, it is a business convenience of the assessee to conduct the Board meeting. The A.O. cannot decide where the assessee has to conduct the Board meeting. In view of the above, we are of the opinion that the Ld. CIT(A) rightly deleted the addition. Disallowance of car hire charges - case of the A.O. is that the assessee has taken a Honda Civic car on rent which is registered in Chennai and the assessee is having no business connection in Chennai therefore, the above expenditure incurred by the assessee is not a business purpose it is only personal purpose - HELD THAT:- We find that when the assessee is having a subsidiary companies in Chennai and some of the Directors are residing at Chennai and the assessee has hired a car for his Directors for the purpose of business, it cannot be said that it is a personal in nature therefore, the Ld. CIT(A) rightly deleted the addition made by the A.O. By considering the above order passed by the Ld. CIT(A), we find no infirmity in the order passed by the Ld. CIT(A). Revenue appeal dismissed.
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