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2015 (12) TMI 1769 - HC - Income TaxClaim of loss for the diminution in value of fertilizer bonds against the sale of fertilizers - Held that:- The assessment order itself shows that in its books, the Assessee categorised the bonds under the head ‘current investment assets’. In that view of the matter, the diminishing value of the bonds not being held as long term investment was in the nature of a revenue loss and could have been claimed as such by the Assessee. The stand of the Revenue that this was only a notional loss and not allowable, is not tenable since bonds held as stock-in-trade can be valued at market rate or cost whichever is less. Disallowance u/s 14A - claim of the Assessee that it incurred no expenditure, other than the administrative expenses, for earning dividend income - Held that:- Under Section 14A(2) of the Act read with Rule 8D of the Income Tax Rules, 1962 the Assessing Officer is required to make an enquiry if he is not satisfied with the correctness of the claim of the Assessee in respect of such expenditure in relation to income which does not form part of the total income. In the present case it has been averred by the Assessee, and not contradicted by the Revenue, that no interest expenditure has been incurred by it for earning the exempt income. There was no basis for the AO to have disallowed any part of such income on that score. No substantial question of law arises
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