TaxTMI 
TaxTMI 
2011 (1) TMI 737
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....med transactions of shares as business and also claimed deduction of interest paid by him. Consequently, he claimed deduction towards business expenditure. However, the Assessing Officer held that it is an investment in shares and that the shares were not treated as stock-in-trade and, therefore, it is a capital asset and the assessee is not entitled to deductions towards business expenditure and also towards payment of interest. Aggrieved by the said order, the assessee preferred an appeal to the Commissioner of Income-tax who upheld the order of the Assessing Officer and dismissed the appeal. Against the said order the assessee preferred an appeal to the Tribunal. The Tribunal on re-appreciation of the material on record held that the ass....
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....for allowance of interest paid on the amounts borrowed for investment in shares as business expenditure? 2. Whether the Tribunal was correct in holding that the assessee is entitled for deduction of interest payment, insurance premium paid on car and depreciation on car as an allowable business expenditure when the assessee was not carrying on the business in trading shares?" 4. The learned counsel for the revenue assailing the impugned order contended that, when the assessee has shown in the balance sheet for the assessment year 2000-01 the shares held by him as an investment and not as stock-in-trade, it constitutes a capital asset and, therefore, the assessee is not entitled to deduction under the heading of business expenditure. There....
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....ent has accepted the said transactions as a business transaction and allowed business expenditure as well as deduction for payment of interest. It is only in the year 2000-01, for the first time, they declined to allow the business expenditure and interest on the ground that the assessee has shown in the balance sheet the shares as an investment and not as stock-in-trade. The assessee has produced the ledgers, bills, receipts to show that he is carrying on the business in shares which clearly shows what is the opening stock, what is the quantum of shares purchased, what is the closing stock, the bills of purchase and sale of shares, etc.. It also discloses that in each month there were purchases of shares of at least 3 to 4 days and in some....