TaxTMI 
TaxTMI 
2015 (11) TMI 484
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....ted against another order dated 04.11.2008 of the learned Commissioner of Income-tax (Appeals), Karnal. Both impugned orders dated 04.11.2008 are in respect of Assessment Year 2005-06. Facts and circumstances of both the cases in appeal are similar. The grounds raised by the Revenue in first and second appeals are also identical except amount involved. In view of above, these appeals are decided by a consolidated order for the sake of convenience. 2. The Revenue in ITA No. 196/Del/2009 has raised following grounds:- "1. On the facts and in the circumstances of the case, the Commissioner of Income tax (Appeals) has erred in law in allowing loss claimed as business loss on the sale of securities to the extent of Rs. 31,10,110/-. 2. On t....
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....sessee by Rs. 9,15,192/- and the Ld C.I.T (Appeals) has erred in confirming the same." 5. Now, first we take up the Revenue‟s appeal in ITA No.196/Del/2009. 6. The facts in brief as culled out from the orders of the lower authorities are that the assessee was engaged in sale and purchase of securities including Government securities. In the return of income filed for the previous year relevant to the assessment year, the assessee has shown taxable income of Rs. 36,89,164/- along with exempted income of Rs. 31,30,110/- from the dividend and Rs. 38,38,304/- from interest on tax free bonds. The case of the assessee was selected for scrutiny. In the course of the scrutiny proceedings, the learned Assessing Officer noticed that the asse....
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....t period only. He further stated that activity of purchase and sale of shares being already held as business activity, the loss should not be allowed. On the other hand, the learned Authorised Representative (in short „AR‟) submitted that there was no dispute as regards to activity of purchase and sale of securities carried out by the assessee held as trading activity, but he contended that loss has been disallowed invoking section 94(7) of the Act by the ld. AO, which is not applicable in the case of the assessee, being purchase of mutual funds under reference beyond three months from the record date of dividend, and therefore the ld.CIT(A) has rightly allowed the loss as per finding given at page 6 of his order . The ld.AR als....
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....loss will not be hit by the section. 11. Now, let us examine whether the assessee falls in net of all the three conditions of the section 94(7) of the Act. In the instant case, the assessee has purchased units of SBI Mutual Fund on 27.12.2004 and the same were sold on 29.03.2005. The record date of dividend in the case of SBI Mutual fund for the relevant year was 28.03.2005. Based on these dates, the ld. AR submitted a chart of calculation of no. of days of purchase of securities from the record date of dividend, according to which, the purchase of securities is 91 days before the record date of dividend. The Sr DR has also not disputed this calculation. In background of these facts, it is evident that units have been purchased 91 days bef....
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....Rs. 3,62,134/- claimed by the assessee in profit and loss account, in proportion of interest income from tax free bond to the total income. Before the CIT(A) the assessee submitted that no expenses were incurred in respect of earning tax free interest income except expenses on receiving of cheques of tax free income on half yearly or annual basis and deposit of the same into the bank and also placed reliance on the cases of Jubilant Enpro Ltd. Vs. CIT (2007) 12 SOT 194 (Delhi) and CIT Vs. Eicher Ltd. (2007) 160 Taxmann 80 (Mad). After considering submissions of the assessee, the CIT(A) reduced the disallowance from Rs. 1,33,682/- to Rs. 25,000/-. 13. At the time of hearing before us, the Sr. DR relied on the order of the ld.AO, whereas, th....
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.... 1 of the assessee‟s appeal is hereby allowed. 20. The ld. AR did not press the Ground No.2 of the appeal, so it is not required any adjudication, and therefore, this ground of the appeal is dismissed. 21. In respect of ground No.3 of the assessee, the facts in brief as culled out from the orders of lower authorities are that in the return of income filed, the assessee claimed tax deducted at source ( TDS) of Rs. 10,64,364/- on interest income and offered interest income of Rs. 88,30,929/-. The ld.AO was of the view that corresponding to the claim of the TDS of Rs. 10,16,364/- at the prescribed rate of TDS, the assessee‟s income from interest should have been at Rs. 97,46,121/- and therefore he added balance interest of Rs. 9,....