TaxTMI 
TaxTMI 
2015 (12) TMI 899
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....3. The revenue is aggrieved by the decision of Ld CIT(A) in allowing interest expenditure claimed against property income. 4. The facts of the case are that the assessee is engaged in market development of fertilizers, agro products and also provides advisory services in investment activities in equities and mutual funds. The first issue relates to the disallowance of claim of loss on revaluation of shares. During the year the assessee purchased shares of a company named M/s Deepak fertilizers and Petrochemicals Corporation Ltd during the period from September, 2008 to March, 2009 in various instalments. The assessee claimed the shares as its "Stock in trade" and accordingly valued it as at the year end at cost or market prices whichever....
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....ndum of articles usually lists out all types of businesses and hence, what is required to be seen is only the activities that are carried on by the assessee. The assessee does not carry on the business of dealing in shares. The assessee has only accumulated the shares of Deepak Fertilizers and Petrochemical corporation Ltd, since it is in the business of market development of fertilizers and agro products. Thus, the intention of the assessee was very clear that the assessee has purchased the shares of the above said company in order to enjoy the pride of possession and the same shows that the intention of the assessee was to hold the shares as investment only. He submitted that the assessee did not purchase shares of any other company in th....
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....e, it would have indulged in repeated purchase and sale of shares. On the contrary, the assessee has proceeded to purchase shares continuously every month and also held it for a quiet a long time. 8. The assessee has relied upon the entries passed in the books of account and also the fact that the shares were purchased out of borrowed funds in order to support its contentions that it intended to purchase the shares as stock in trade. However, as held by Ld CIT(A), these two factors alone cannot be taken as determinative factors and accordingly the intention of the assessee should be gathered from the conduct of the party and surrounding circumstances. We also notice that the assessee had originally disallowed part of interest expenditure....
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....Rs. 40,94,203/- as the interest relating to investments made in purchase of Shares of M/s Deepak Fertilisers and Chemicals Ltd. However, during the course of assessment proceedings, the assessee requested the AO to allow the interest expenditure of Rs. 40,94,203/- referred above on the grounds that the shares of Deepak Fertilizers have been purchased as stock in trade. Since the assessing officer has held that the shares of Deepak Fertilizers have been purchased only to hold it as investments, the AO rejected the claim of the assessee and it was also confirmed by Ld CIT(A). 11. Since we have upheld the view taken by the tax authorities and since the shares of Deepak Fertilizers & Petrochemicals Ltd has been purchased to hold them as inve....
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....ut of funds borrowed from M/s Nova Synthetics. Initially the assessee disallowed a sum of Rs. 90,811/- out of interest expenditure as relating to purchase of flat. During the course of assessment proceedings, it revised the amount of interest attributable to purchase of flat to Rs. 71,72,215/- and claimed the same as deduction u/s 24 of the Act under the head "Income from House property" by computing the notional rental income of Rs. 3.25 lacs. The AO held that the interest expenditure cannot be deducted as business expenditure, since the assessee itself has held it to be so. Since the assessee had not let out the house property, the AO held that the assessee cannot claim the same u/s 24 of the Act also. 14. The Ld CIT(A) observed that t....