9911796707
TMI Blog2013 (10) TMI 921X X X X Extracts X X X X X X X X Extracts X X X X ..... he business of investment in shares and securities. During the financial year under consideration the assessee company paid rent of Rs.81,60,000/- for its business premises. On being asked as to the justification of the said expenditure, the assessee company submitted before the AO that the said premises was used for the business purpose of the assessee. The rent was paid for fully development furnished and infrastructure supported structures. Further that the amount of rent includes charges towards electricity, telephone, furniture and all kinds of information and technology supporting and parking etc. It was further submitted that the company wanted to expand its business activities by way of also engaging in trade and software developmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stified. It was for the assessee company to decide as to what type of premises and the facilities and infrastructure it wanted to occupy to run its business. It is not the case of the Revenue that the rent paid by the assessee company was exaggerated in comparison to the market letting value of the premises at that time. The only ground that the assessee wanted to engage in a new business but it did not do so, is not justified to make the disallowance of the entire rent amount. Even the ld. CIT(A) while confirming the disallowance has not considered this aspect of the matter. There is no denial to the fact during the financial year in consideration, the assessee company had been engaged in the business, assessed to income tax, and the premi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed a sum of Rs.31,46,288/-. In appeal, the ld. CIT(A) while relying upon an authority of the Hon'ble Bombay High Court in the case of "M/s Godrej & Boyce Ltd.". Vs. DCIT [(2010) 328 ITR 81 (Bom)] observed that the Rule 8D was not applicable for the assessment year under consideration and the same was applicable from assessment year 2008-09 onwards. For the year under consideration, a reasonable disallowance should have been made as per the law laid down by the Hon'ble Bombay High Court in the above said authority. The ld. CIT(A) thus restricted the disallowance to the extent of Rs.1,73,446/-. He, however, further disallowed a sum of Rs.30,31,633/- claimed as mark to market loss on F&O transactions by the assessee. 7. It may be observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Kotak Mahindra Investment Ltd." While dealing with the said issue, the co-ordinate bench of this Tribunal observed that the stock future is one of the types of forward contract, which is traded on exchanges. This can be traded in BSE as well as in NSE. In such type of contracts, the stock is not actually purchased rather the profit or loss is calculated on the book value in comparison to the actual market rate of the stocks on the date which has been agreed by the parties for the performance of the contract. Certain stocks are booked to be purchased at a predetermined particular rate on future date and when such future date of performance of contract becomes due, then the predetermined price is compared with the actual market rate of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds. The Hon'ble Supreme Court in the case of CIT v. "Woodward Governor India (P.) Ltd." (2009) 179 Taxman 326, while dealing with the question as to whether the additional liability arising on account of fluctuation in the rate of exchange can be allowed to be adjusted pending actual payment of the varied, has observed that "expenditure" as used in section 37 in Income Tax Act may in the circumstances of a particular case cover an amount which is a "loss" even though said amount has not been given from the pocket of the assessee. It has been further observed that the ordinary principle of commercial accounting requires that in the Profit & Loss account the value of stock in trade at the beginning and at the end of the year should be entere ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
