TaxTMI 
TaxTMI 
2015 (10) TMI 733
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.... Gains. And (b) in not considering the revised return of income filed by the assessee. 3. The facts relating to the above said issues are stated in brief. The assessee is engaged in the business of sale of electricity generated by Wind Mills. In the return of income, the assessee claimed interest expenditure of Rs. 5,81,410/- as deduction against the Short term Capital gain on the reasoning that the bank interest on the loan taken for making investments in purchase of shares should be considered as part of "Cost of acquisition of shares". The A.O. did not accept the same and held that the provisions of sec. 48 do not provide for deduction of interest expenses against the Capital gains. The AO, however, expressed the view that the said cla....
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....e rival contentions and perused the record. The first issue relates to the claim for deduction of interest expenditure against the Short term Capital gain. We notice that the assessee has placed reliance on the following case law before Ld CIT(A) to support her claim:- (a) CIT Vs. Maithreyi Pai (152 ITR 247) (b) ACIT Vs. K.S.Gupta (119 ITR 372)(AP) (c) Challapalli Sugars Ltd (98 ITR 167)(SC) In all the above cited cases, the expression "actual cost" has been explained. As observed by the assessing officer, the question of ascertaining the "actual cost" arises only for a "Capital asset" under the head "Income from business". In this regard, we may make a gainful reference to sec. 43 of the Act, wherein the expression "actual cost" is def....
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....y, earned from the Shares. The above said view gets support from the decision rendered in the case of V. Mahesh, ITO Vs. Vikram Sadanand Hoskote (2007)(18 SOT 130)(Mum), wherein it is held that the interest expenditure incurred on borrowed funds for the period commencing from the date of acquisition of shares till date of sale would not form part of cost of acquisition of shares. 7. Before us, the Ld A.R placed reliance on the following case laws to support his contentions:- (a) Alka Rajesh Agarawal Vs. ACIT (ITA No.2393/Mum/2012 dated 09.10.2013) (b) Kalyanji J Tanna (decd.), Mumbai Vs. ITO (ITA No.3137/Mum/2010 dated 29.03.2011. (c) S.Balan alias Shanmugam Balakrishnan Chettiar Vs. DCIT (ITA No.1859/PN/2005 dated 31-01-2008) A perusa....