TaxTMI 
TaxTMI 
2015 (8) TMI 1
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.... 2. At the outset, it is noticed that the appeal of revenue is delayed by 32 days and Condonation petition has been filed explaining the reasons for delay along with supporting affidavit. On query from the Bench, Ld. Counsel for the assessee has not opposed the Condonation rather he conceded that delay can be condoned. In view of the above reasons given in the Condonation petition and concession given by Ld. Counsel for the assessee, we condone the delay and admit the appeal. 3. The first issue in this appeal of revenue is against the order of CIT(A) deleting the addition made by AO on account of disallowance of expenses relatable to exempt income by invoking the provisions of section 14A of the Act read with Rule 8D of the I. T. Rule....
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....or the acquisition of shares only if shares were held as stock-in-trade and that would arise only if the assessee was engaged in trading in shares. So far as the acquisition of shares was in the form of investment and the only benefit the assessee derived was the dividend income which was not assessable under the Act, the disallowance under section 14A was squarely attracted and the Assessing Officer rightly disallowed the claim." Further, this issue has been adjudicated by Hon'ble Karnataka High Court in the case of M/s. CCI Ltd. Vs. JCIT, ITA No. 359 of 2011 dated 28.02.2012, wherein vide para 5 it has been held as under: "5. When no expenditure is incurred by the assessee in earning the dividend income, no notional expenditure ....
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....tion 14A read with Rule 8D of the Rules will not apply to the shares held as stock in trade. However, Ld. CIT, DR stated that Hon'ble Delhi High Court is contrary to the above two decisions. The Hon'ble Delhi High Court in Maxopp Investment Ltd. vs. CIT (2012) 347 ITR 272 (Del) has taken a contrary view and stated that even section 14A read with Rule 8D of the Rules will apply to shares held as stock in trade. But keeping in view the decision of Hon'ble Supreme Court in the case of CIT vs. Vegetable Products Ltd. (1973) 88 ITR 192 (SC), and as the Hon'ble Karnataka High Court and Hon'ble Kerala High Court are in favour of the assessee, we decide this issue in favour of the assessee and against the revenue by respectfully....
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....the case of Horizon Capital Ltd., supra and even Hon'ble jurisdictional High Court in CIT Vs. M/s. Winro Commercial India Ltd. GA No. 274 of 2013, ITAT No. 25 of 2013 and CIT Vs. M/s. Todi Securities (P) Ltd. in GA No. 425 of 2013, ITAT No. 32 of 2013 dated 25.03.2013, wherein it has held as under: "Mr. Khaitan, learned senior advocate happened to be present when the matter was taken up for hearing. He pointed out that this question is already covered by a judgment of the Karnataka high Court. He produced a copy of the judgment in the case of The Commissioner of Income Tax Vs. M/s. Horizon Capital Ltd. wherein the following view was taken: "17. Therefore, the contention that this benefit is not available to the assessee whose tota....