TaxTMI 
TaxTMI 
2015 (11) TMI 1368
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....A)-XVI, Ahmedabad, dated 28.04.2011 passed in case no.CIT(A)-XVI/AC.Cir.3/710/10-11, in proceedings under section 143(3) of the Income Tax Act, 1961, in short 'the Act'. 2. We come to Revenue's appeal ITA No.1531/Ahd/2014. Its first ground challenges the lower appellate order deleting disallowance / addition of NSE penalty of Rs. 74,515/-. The assessee is a limited company in stock broking business. It paid the impugned sum to the National Stock Exchange for non-compliance of its bye-laws. The assessee's case was that this penalty sum pertained to procedural delay in filing compliance report to the exchange. And the delay caused was in payment of dues and other obligations. The Assessing Officer disallowed this claim as a business deduct....
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....ted entities. This would make the Assessing Officer to compute the proportionate interest disallowance in question of Rs. 4,61,573/- in assessment order dated 30.12.2010. 3. We come to the lower appellate proceedings now. The CIT(A) prepares a party-wise tabulation qua loans in question of Rs. 32,03,147/- as incurred in reimbursement of expenses. He finds the same to have been incurred in business purposes as per case law of S A Builders vs. CIT, 288 ITR 01 (SC) as having business expediency element embedded therein. The Revenue's arguments strongly support Assessing Officer's action. It transpires from the case file that assessee's interest free funds as on 31.03.2008 read a figure of Rs. 1,25,83,17,835/- in the nature of share capital,....
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....decision of the tribunal (2010) 5 ITR (Trib) 1 (Bom.) DCIT vs. Shreyas S. Morakhia as upheld in (2012) 342 ITR 285 (Bom.) CIT vs. Shreyas S. Morakhia that value of the share transacted by a broker-assessee on behalf of the concerned client is very much allowable as bad debts. The Revenue fails to rebut this legal position. We reject this third substantive ground accordingly. 6. This leaves us with the Revenue's forth and last substantive ground seeking to restore brokerage rebate disallowance of Rs. 34,67,507/-. This sum represents assessee's rebate to its client on the ground that the brokerage rate charged was found to be more than that agreed, the same was reduced in order to retain the clientele and it is a volume-base promotion sche....
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....y ground to interfere with the lower appellate findings under challenge. This forth and last ground is also rejected. Revenue's appeal ITA No.1531/Ahd/2011 is dismissed. 9. We advert to assessee's appeal ITA No.1718/Ahd/2011. Its first ground challenges Section 14A disallowance of Rs. 15,50,074/-. Its exempt income from dividends reads a figure of Rs. 11,67,255/- arising from investment of Rs. 3,37,75,313/- in shares of M/s. Arvind Mills Ltd. with long term investment in shares of its subsidiary amounting to Rs. 18,70,95,122/-. The assessee did not attribute any expenditure corresponding to its exempt income. It pleaded to have sufficient interest free funds at its disposal in relation to the impugned investments. The Assessing Officer q....
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....pute correctness thereof since the impugned assessment year is 2008- 09. This latter disallowance figure is confirmed. This ground is partly allowed. 11. The second substantive ground challenges disallowance of provision made for leave encashment amounting to Rs. 46,86,997/- made u/s 43B(f) of the Act. The assessee had not paid the same till date of filing of return. It quoted hon'ble Calcutta high court decision in Exide Industries vs. Union of India, 292 ITR 470, striking down the above stated provision itself being arbitrary, unconstitutional and de hors the case law of Bharat Earth Movers vs. CIT, 245 ITR 428 (SC). The Assessing Officer reproduced hon'ble apex court's interlocutory order in SLP (CC) No.12060/2008 directing the said a....
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.... Exchange card. Nor such a distinction is forthcoming from hon'ble apex court decision. We find that a co-ordinate bench of the tribunal in case of assessee's sister concern's case M/s. Edelweiss Stock Broking Ltd. Vs. CIT, ITA No. 1168/Ahd/2011 decided on 11.07.2014 for AY 2006-07 grants identical depreciation relief. We also draw support therefrom for allowing the impugned depreciation claimed. This ground is accepted. 14. This leaves us with assessee's last substantive ground challenging section 40(a)(ia) of Rs. 1,02,39,903/- arising from non-deduction of TDS qua payments made of NSE lease line charges, NSE VSAT charges and MTNL expenses. There is no dispute that the assessee has not deducted TDS on these payments. We have given our t....