TMI Blog2015 (5) TMI 1125X X X X Extracts X X X X X X X X Extracts X X X X ..... s, which were purchased in the past. The assessee had also asserted before the CIT(A) without rebuttal, that the interest cost so incurred in the past was not claimed as a deduction against any other income. Be that as it may, in so far as the factual position is concerned, there is no denial by the Revenue that monies borrowed have been utilized for acquisition of shares in question. Therefore, having regard to the factual findings of the CIT(A), in our view, the legal position as propounded by the Hon’ble Madras High Court in the case of Trishul Investments Ltd (2007 (7) TMI 252 - MADRAS HIGH COURT ) supports the plea of the assessee that interest paid for acquisition of the shares would partake the character of cost of shares and, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shah Vs. DCIT Central Circle -11, Mumbai reported in (2007) 105 ITD 669 (Mumbai) c) Harish Krishnakant Bhatt Vs. ITO reported in (2004) 91 ITD 311 (AHD). 2. In brief, the relevant facts are that the assessee is an individual who filed his return of income for assessment year 2005-06 declaring a total income of ₹ 1,19,63,100/- which, inter-alia included a Long Term Capital Loss on shares sold during the year under consideration. The Assessing Officer differed with the assessee on the computation of capital gains on sale of shares which were acquired by the assessee in the past. The Assessing Officer noted that the interest cost incurred by the assessee for acquisition of shares in the past was treated as part of the cost of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sale of land. Against the aforesaid decision of CIT(A), the Revenue is in appeal before us. 3. We have considered the rival stands. The controversy before us is as to whether the interest paid by the assessee on loans taken for acquiring the shares in the past can be allowed as a deduction u/s 48 as cost of acquisition while computing capital gain on sale of such shares. On this aspect, the Ld. Representative for the respondent assessee relied upon the Judgment of Hon ble Madras High Court in the case of Trishul Investments Ltd. 305 ITR 434(Madras) which is directly on the point. In the case before the Hon ble Madras High Court, the assessee was carrying on the business of investment in shares/securities and the profit derived from sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so far as the factual position is concerned, there is no denial by the Revenue that monies borrowed have been utilized for acquisition of shares in question. Therefore, having regard to the factual findings of the CIT(A), in our view, the legal position as propounded by the Hon ble Madras High Court in the case of Trishul Investments Ltd (supra) supports the plea of the assessee that interest paid for acquisition of the shares would partake the character of cost of shares and, therefore, assessee had rightly capitalized the interest along with the cost of acquisition for the purpose of computing capital gains. The conclusion of the CIT(A) thus deserves to be affirmed. 4. Before us, the Ld. DR however referred to the decisions of Mumbai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsibly, the Mumbai Bench of the Tribunal in the case of Macintosh Finance Estates Limited (supra), did not have the benefit of the Judgment of Hon ble Madras High Court because the Judgment of Hon ble Madras High Court was rendered on 12.07.2007, whereas, the decision in the case of Macintosh Finance Estates Limited (supra), was rendered by the Tribunal on an earlier date i.e. on 27.02.2006. Therefore, the Judgment of Hon ble Madras High Court being directly on the point, we prefer to follow the same. 5. The next decision which has been relied upon by the Ld. DR before us, is the decision of Ahmadabad Bench of the Tribunal in the case of Harish Krishnakant Bhatt Vs. ITO [91 ITD 311]. The said decision of Ahmadabad Bench of the Tribunal i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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