TMI Blog2014 (7) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... n trade - The assessee in subsequent years could not have claimed the said shares as stock in trade as per its own will - assessee after the finding of the Income Tax Authorities that the shares were investments, had not made any attempt or action to convert the shares into stock in trade - the shares are required to be held as investments only and the assessee is not entitled to claim any diminution in the value of the said shares treating the same as stock in trade – Decided against Assessee. Disallowance u/s 14A of the Act – Investments made for earning tax free income - Held that:- The decision in Godrej & Boyce Manufacturing Co. Ltd. Vs. DCIT [2010 (8) TMI 77 - BOMBAY HIGH COURT] followed - rule 8D of the Income Tax Rules is applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onfirming the disallowance of ₹ 80,34,343/- on account of diminution in value of shares held as stock in trade. 4. Appellant craves leave to amend or alter the existing grounds or add further grounds at the time of hearing. 3. Vide first ground, the assessee has prayed for the condonation of delay of three days in filing the present appeal. However, as per the note of the registry, the appeal is barred by two days only. The ld. A.R. of the assessee has submitted that though the assessee had instructed his chartered accountant to file the appeal in time, but the said chartered accountant had to suddenly leave for his home town due to some urgency and on return he immediately filed the appeal of the assessee. The delay of two days w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R. is general in nature and is not supported with any convincing evidence. We do not find any infirmity in the order of the lower authorities while making the above disallowance. This ground is accordingly decided against the assessee. 7. Vide ground No.3, the assessee has agitated the confirmation of disallowance of ₹ 80,34,343/- on account of diminution in value of shares held as stock in trade. The ld. CIT(A) noticed that the AO in the year 2004-05 had treated the assessee s holding in the shares as capital assets and not as stock in trade. The assessee did not prefer any appeal against the said finding of the AO and the said finding was further confirmed by the ld. CIT(A) vide order dated 27.11.07 in appeal No.CIT(A)XII/Add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be observed that the assessment year in question is 2006-07. As per the law laid down by the Hon ble Bombay High Court in the case of Godrej Boyce Manufacturing Co. Ltd. Vs. DCIT reported in (2010) 328 ITR 81 (Bom) , the rule 8D of the Income Tax Rules is applicable for assessment year 2008-09 onwards. In the case in hand, the ld. CIT(A) observed that the assessee had earned certain exempt income, however the assessee had not appropriated any expenditure for earning the exempt income. The ld. CIT(A) therefore directed the AO to apportion/segregate the expenditure incurred for earning taxable and non taxable income and make a reasonable disallowance appropriated towards earning tax free income. In our view, the finding of the ld. CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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