2017 (9) TMI 378

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.... eye of law and on the facts. 2. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in passing an order without giving assessee an opportunity of being heard in clear violation of principle of natural justice. (ii) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in passing an order ex-parte despite the fact that the assessee was prevented from appearing because of the reasons beyond the control of the assessee. 3. (i) On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the action of the AO in making disallowance of an amount of Rs. 37,500/- invoking the provision of secti....

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....rading. During the course of assessment proceedings, it was observed that the assessee company has made investment in Mutual Funds. Assessee was asked to provide the details of disallowance u/s. 14A read with Rule 8D of the I.T. Rules, 1962. In its reply dated 5.3.2015, assessee simply stated that no income has been earned on investments and the additions made on similar grounds has been deleted by the higher authorities and hence, no disallowance u/s. 14A should be made. AO after considering the reply of the assessee, observed that since the assessee has made investment of earn the dividend income and capital gains, required to disallowance u/s- 14A read with rule 8D. AO further observed that since the assessee has claimed that no expenses....

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....time of hearing, Ld. Counsel of the assessee with regard to disallowance of Rs. 37,500/- made u/s. 14A has stated that this issue is squarely covered by the decision of the Hon'ble Jurisdiction High Court in the case of Cheminvest Ltd. vs. CIT [2015] 378 ITR 33 (Del.), because there is no exempt income earned by the assessee during the year consideration. Hence, he requested that the addition in dispute may be deleted. 5.1 With regard to addition of Rs. 29,82,952/- is concerned, Ld. Counsel of the assessee has stated that this issue is also squarely covered by the decision of the Hon'ble Supreme Court in the case of CIT vs. Cocanada Radhaswami Bank Ltd. (1965) 57 ITR 306 (SC), because the entire income of the assessee include interest on s....

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....he assessee. 7.1 As regards to the disallowance of Rs. 29,82,952/- is concerned, we note that assessee is engaged in the business of trading in securities and shares. In the year under consideration the assessee suffered a loss of Rs. 29,82,952/- on the sale of Mutual Fund which was held as stock in trade and as such claimed as business loss. The issue in this case is whether the amount of Rs. 29,82,952/- on account of loss on sale of mutual funds can be treated as capital loss as held by the AO as against business loss shown by the assessee. It is undisputed fact that the loss has been incurred during the normal course of the business. Since the assessee's only source of income was his interest and in this view the loss incurred on th....