2017 (3) TMI 1331

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....s business income overlooking consistent treatment of the appellant of the gains made on investments. 2. The Learned CIT(A) erred in facts and circumstances of the case and in law in confirming disallowance made by AO Under Section 14A of The Income Tax Act 1961 3. The Learned CIT(A) erred in facts and circumstances of the case and in law in not adjudicating ground seeking rebate U/s 88E in the event STCG declared by the appellant is held as business income. 2. Brief facts of the case are that the assessee filed its return of income for relevant AY on 04.10.2010 declaring total income at Rs. 98,82,190/-. The assessment was completed u/s 143(3) of the Act on 24.02.2014. The Assessing Officer (AO) while passing the assessment order besid....

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....t of the total available capital of Rs. 2.06 Crore, the assessee  invested Rs. 1.48 Crore in share and securities. The assessee had dealt with 14 securities. After considering the period of holding, frequency of transaction, quantum of turnover, the AO concluded that the assessee is indulge in trading of share and the profit derived from such trading including sale of LTCG and STCG was treated as "Business Income". On appeal before the ld. CIT(A), the action of AO was confirmed, the ld. CIT(A) also concluded that assessee is involved in the trading of share and not investor and the transaction are clearly in the nature of business transaction. We have seen that the assessee has filed the breakup of STCG for relevant AY. The assessee ha....

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....on and Rs. 9.84 Lakhs from REC LTD., which consist of total about 97% of STCG. We have further noticed that out of the claim Rs. 99 Lakhs , the assessee has opening balance of Rs. 73.39 Lakh is out of opening balance of STCG. The assessee transacted only in 15 scripts. The Ld DR not disputed the that in earlier year the similar income was accepted as STCG. The Co-ordinate Bench in Paresh D. Shah (supra) while considering the similar issue held as under: 5. We have also noted that it is an admitted position - both by the Assessing Officer as also by the CIT(A) - that the material facts of the present assessment year are the same as of the immediately preceding assessment year which has been decided in favour of the assessee by the coordina....

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....t made any voluntary disallowance as the assessee has not made any expanses for earning such income. The assessee has owned sufficient interest free funds available with it.  The ld AR submitted that the disallowance may be restricted to the exempt income.  The ld AR for assessee in support of his submission the ld AR for assessee relied upon the decision of M/s Vahanvati Consultants P. Ltd. vs. DCIT in ITA No. 8700/Mum/2011 and on Sanghvi Apporva  Lalubhai (HUF) Vs. ACIT in ITA No. 7767/Mum/2014. On the  other hand the ld DR for the revenue supported the order of the authorities below. 8. We have considered rival contention of the parties and gone through the order of authorities below. During the assessment the AO obs....