TaxTMI 
TaxTMI 
2011 (6) TMI 467
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Tax Act, 1961. Grounds of appeal No. 1 raised by the Revenue is therefore dismissed. 4. In grounds of appeal No. 2, the Revenue has challenged the order of the ld. CIT(A) in deleting the disallowance of Rs. 17,217/- on account of penalty/fine paid to BSE/NSE of India for infringement of statutory law since SEBI is a statutory body. 5. After hearing both the sides, we find the A.O. disallowed an amount of Rs. 17,217/- paid to BSE/NSE on the ground that the same has been paid as penalty/fine for infringement of statutory law since SEBI is a statutory body. On appeal, the ld. CIT(A) deleted the disallowance on the ground that the same has been made for violation of regulations regarding procedures to be followed for entering into share transaction. These payments were just compensatory in nature and there is no infringement of any law. We find similar issue had come up before the Tribunal in assessee's own case for A.Y. 2002-03 and the Tribunal vide order dated 23rd July, 2008 in ITA No. 438/Mum/06 has dismissed the appeal filed by the Revenue. Respectfully following the decision of the Tribunal in assessee's own case for A.Y. 2002-03 and in absence of any contrary decision brought....
X X X X Extracts X X X X
X X X X Extracts X X X X
....made by the A.O. The ground raised by the Revenue is accordingly dismissed. 9. Ground No. 4 by the Revenue reads as under:- "On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in directing the A.O. to allow the credit for the TDS of Rs. 1,15,585/-, when out of the corresponding dividend income of Rs. 11,06,551/- an amount of Rs. 10,27,400/- was remitted by the assessee to its clients and only Rs. 79,150/- was assessed in the hands of the assessee." 10. Facts of the case in brief are that during the assessment proceedings, the A.O. noted that the assessee had claimed credit for tax deducted at source of Rs. 1,15,585/- on dividend amounting to Rs.11,06,551/-. However, the assessee has shown Rs. 79,150/- for taxation in its hands since it had paid dividend of Rs.10,27,401/- to the clients to whom the shares actually belong. According to the A.O. credit for TDS cannot be allowed to any person other than to whom the income actually belongs in view of provisions of section 199 of the Act. He, therefore, granted TDS credit of Rs. 8310/- only i.e. to the extent of dividend of Rs.79,150/- actually shown by the assessee. 10.1 In appeal, the ld. CIT(A) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sistently from inception of the company and taxing capital gains separately and taking it out from the purview of explanation to section 73. 3) The Learned Commissioner of income-tax (Appeals) has further erred in not treating the gain in derivative transactions as capital gains and not setting it off against capital gains in shares and the reasons assigned by him in doing so are wrong and are contrary to the provisions of Income Tax Act, 1961 and rules made thereunder. 4) Consequently having confirmed the change in opinion on tax treatment on capital gains, the Commissioner of Income tax (Appeals) has further confirmed the additions of Rs. 1,53,369/- by treating it as short term capital gain." 13.1 Facts of the case in brief are that the assessee is a Member of both BSE and NSE and is carrying on the business activity in secondary as well as primary market. During the course of assessment proceedings, the A.O. noted that the assessee has made profit in trading in shares/derivatives of Rs.37,30,171/-. The assessee has set off this profit against loss on sale of investment amounting to Rs. 41,35,004/-. On being questioned by the A.O., it was submitted by the assessee that in view....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ital loss as per provisions of law. He, accordingly, upheld the action of the A.O. in bringing to tax of Rs. 1,53,369/-. 13.2 Aggrieved with such order of the ld. CIT(A), the assessee is in appeal before us. 13.3 The ld. Counsel for the assessee referring to the statement of computation of income for A.Y. 2002-03, a copy of which is placed at paper book page 59 to 61, submitted that the assessee had disclosed the taxable speculation income at Rs. 49,81,851/-. Referring to the computation statement for A.Y.2000-01placed at paper book page 67, he submitted that the assesse has disclosed speculation income of Rs. 452,605/-. Referring to the copy of the assessment order passed u/s 143(3) for A.Y. 2000-01 and 2002-03, he submitted that the A.O. has accepted such speculation income. Even in subsequent A.Y. i.e. for A.Y. 2005-06 also the A.O. has accepted the speculation income. He submitted that from A.Y. 1997-98 onwards the assessee has never offered capital gain. The assessee being a share broker offered income from sale of shares on account of clients as well as on its own account as business income although the shares were shown as investment in the balance sheet since it has to be....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erest paid on the non-refundable deposits of the shareholders either under section 28 or section 37 of the Income-tax Act, 1961. The income of the assesse must be treated as income from trade or business. 13.4 He accordingly submitted that since the Revenue has all along accepted the speculation income of the assessee for different assessment years u/s 143(3) assessment in both preceding and succeeding years, therefore, the Revenue cannot take a different view for this particular year. He also relied on various decisions as per paper book filed. 14. The ld. D.R., on the other hand, relied on the order of the ld. CIT(A). He submitted that the assessee had opportunity before the A.O. as well as CIT(A) to explain his case. 14.1 However, he could not explain it properly. The Tribunal in assessee's own case for A.Y. 2005-05 while deciding the issue had not gone into the facts on this issue. He accordingly submitted that the order of the ld. CIT(A) on this issue be upheld. 14.2 The ld. Counsel for the assessee in the rejoinder relied on the decision of the Hon'ble Supreme Court in the case of Radhasoami Satsang vs. CIT reported in 193 ITR 321 and submitted that where a fundamental as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ncome Tax Act, 1961 and rules made thereunder." 16.1 Facts of the case in brief are that the assessee had written off an amount of Rs.7,96,255/- as bad debts being loan written off. On being questioned by the A.O., it was submitted that the assessee company during the course of business activity had advanced loan to Mr. Yogesh R. Choksey which was in operation from April, 1996 onwards. The loan was advanced as well as received according to business need of both sides. The last repayment was in February, 2000 leaving a debit balance of Rs.7,96,255/- as on 31st March, 2000. The party made further repayment in next year but the cheque was bounced. Since the chances of recovery were quite negligible, the assessee company during the impugned A.Y. wrote off the entire amount as not recoverable and the same was claimed as business loss u/s 28 of the Act. 16.2 However, the A.O. did not accept the contention of the assessee. He noted that non-recovered debt cannot be treated as a bad debt u/s 37(1)(vii) of the Act since the amount has not been offered for taxation in any earlier years as income of the assessee. Further, the loss cannot be treated as business loss for A.Y. 2003-04 since th....