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2015 (9) TMI 1432

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..... so of the view that the interest expenditure incurred under the heads interest on share margin,interest on IPO funding,and interest on car loans should not be considered for disallowance to be made u/s.14A of the Act.We find that in the matter of India Advantage Securities Ltd.(2012 (11) TMI 458 - ITAT, MUMBAI )the issue of proportionate disallowance u/s.14A r.w.Rule 8D was discussed by the Tribunal in length and it was held that stock in trade(Shares)cannot be considered for disallowance and that shares held as investment could be taken into consideration for calculation of Rule 8D. The said judgment was confirmed by the Hon’ble Bombay High Court (2015 (6) TMI 140 - BOMBAY HIGH COURT ). Considering the above we are of the opinion that the .....

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..... ssessing Officer u/s 14A of ₹ 11,04,298/-. Your appellants submit that in the facts and circumstances of the case and in law, no disallowance under section 14A is called for and the said addition be deleted. Without prejudice to the above, your appellants submit that the disallowance u/s.14A is excessive and ought to be reduced substantially. 2) The learned Commissioner of Income Tax (Appeals) erred in confirming the addition made by the Assessing Officer in respect of salary paid to Mrs. Bina K. Mehta, Senior Finance Executive of ₹ 1,01,800/-. Your appellants submit that under the facts and circumstances of the case and in law, the addition is not warranted and ought to be deleted. 3) Your appellants further reserve th .....

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..... ssessee preferred an appeal before the First Appellate Authority(FAA).Before him,it was argued that the assessee itself had disallowed certain portion of expenditure,that expenses bearing nexus with the earning of exempt income had already been disallowed,that all other expenses were in nature of routine business expenses which were necessary to keep the business afloat,that dividend income was derived from the shares that were part of stock in trade,that the whole of the loan was utilised for purchase of stock of shares during the year,that it had purchased shares of ₹ 4.33 crores,that dividend income was incidental to the business income,that no amount was needed to be disallowed out of the interest payments.The assessee relied upon .....

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..... holding of shares as stock in trade and interest expenditure incurred for personal or business purposes,that while calculating the total assets appearing in the balance sheet the AO taken assets after deducting the current liabilities and provisions.In our opinion,such assets should be total of fixed assets,investments and current assets,loans and advances.We are also of the view that the interest expenditure incurred under the heads interest on share margin,interest on IPO funding,and interest on car loans should not be considered for disallowance to be made u/s.14A of the Act.We find that in the matter of India Advantage Securities Ltd.(supra)the issue of proportionate disallowance u/s.14A r.w.Rule 8D was discussed by the Tribunal in leng .....

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..... was on the assessee to prove that expenses were reasonable and not excessive,that the assessee had adduced any evidence in support of its claim.Finally,he made a disallowance of ₹ 1.01 lakhs(excess over the salary of last AY.). 3.1.During the appellate proceedings,before the First Appellate Authority(FAA),the assessee contended that BKM was promoted as Senior Finance Executive from Assistant Finance Executive,that her salary was increased,that she was looking after job of bill discounting, letter of credit,arranging inter corporate deposits etc,that department had consistently accepted the salary paid to her over the years,that the salary paid to her was reasonable.After considering the submission of the assessee and the assessment .....

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