TaxTMI 
TaxTMI 
2014 (2) TMI 686
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....4 & 5. Hence, for the sake of brevity, we do not deem it necessary to reproduce the grounds which have not been pressed. There remains the following grounds of appeal are for adjudication by us. "3. The CIT(A) erred in disallowing transaction charges u/s 40(a)(ia) of Rs.8,37,889/-." "6. The CIT(A) has gone beyond his powers to enhance the income under various heads, in particular LTCG by Rs.1,20,91,700/-." 7. The CIT(A) erred in calculating LTCG and made addition of Rs.1,20,91,700/-. 8. The CIT(A) erred in ignoring the provisions of Section 47 (xiiia). As per the said section any exchange of a capital asset being membership right held of a recognised stock exchange for acquisition of shares of stock exchange will not attract Sec....
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....cannot be disallowed under section 40(a)(ia) of the I.T. Act. He has contended that the transaction charges as such fall within the definition of expenditure allowable under section 28 of the Act. 3. With due respect to the observations made by the co-ordinate bench of the Tribunal in the case of 'Teja Constructions' (supra), in our humble view, the section 28 of the Act deals with the income chargeable to tax under the head 'profits and gains of business or profession'. It does not deal with the expenditure allowable as deduction for computation of income under the head 'profits and gains of business or profession'. Section 30 to section 36 & section 38 deal with certain specific type of expenditure which is allowable as deduction while....
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....R 323 / 193 Taxman 248 and T.R.F. Ltd. v. CIT 323 ITR 397 / 190 Taxman 39. However, the Hon'ble High Court held that the transaction charges paid by the assessee to stock exchange constitute fees for technical services u/s. 194J of the Act and, therefore, the assessee was liable to deduct tax at source while crediting the transaction charges to the account of stock exchange. So, in view of the law laid down by the Hon'ble High Court in the case of Kotak Securities Ltd. (supra), we do not find any infirmity in the order of the CIT(A) disallowing expenditure relating to transaction charges. This ground of the appeal of the assessee is accordingly dismissed. Ground Nos.6, 7 & 8: 5. The above grounds of appeal are interconnected and ar....
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....e records. Section 2(42A)(ha) is relevant for deciding the point in issue which for the sake of convenience is reproduced as under: "2. Definitions In this Act, unless the context otherwise requires,- (42A) 9 ["short-term capital asset" means a capital asset held by an assessee for not more than 10[thirty-six] months immediately preceding the date of its transfer10a :] 11 [Provided that in the case of a share held in a company 12[or any other security listed in a recognised stock exchange in India or a unit of the Unit Trust of India established under the Unit Trust of India Act, 1963 (52 of 1963) or a unit of a Mutual Fund specified under clause (23D) of section 10] 13[or a zero coupon bond], the provisions of this clause shall have ....
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....ange in hand, the period for which the assessee was a member of the recognised stock exchange prior to such demutualisation or corporatisation shall also be included. Hence, the holding period of the asset is to be calculated from the acquisition of date of 'BSE card' and not from the date of conversion of 'BSE card' into equity shares. As per the section 55(2)(ab) of the Act, the cost of acquisition in relation to equity shares allotted to a shareholder under a scheme of demutualisation or corporatisation shall be the cost of acquisition of his original membership of the exchange. For the sake of convenience section 55 (2) (ab) is reproduced as under: "55.(2). [For the purposes of sections 48 and 49, "cost of acquisition"96,-- [(ab) in ....