TaxTMI 
TaxTMI 
2018 (9) TMI 1680
X X X X Extracts X X X X
X X X X Extracts X X X X
....sallowance of Mark to Market loss claimed by the assessee? 2. Whether on the facts and circumstances of the case & in law, the Ld. CIT (A) has erred in deleting the addition of Rs. 5,03,94,883/- without appreciating the fact that mark to market loss is a loss generated through an accounting entry rather than actual sale of a security and ignoring the finding of the Assessing Officer in this regard that no actual sale or settlement took place and loss claimed by the assessee was thus only a notional loss? 3. Whether on the facts and circumstances of the case & in law, the Ld.CIT(A) has erred in deleting the disallowance of Rs. 13,26,721/- u/s 14A r w Rule 8D? 4. That the order of the ld is erroneous and is not tenable on facts and i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s only a notional loss. The Assessing Officer further held that the assessee did not produce any evidence that such notional loss was settled by making payment or cancellation of contract. Thus, the Assessing Officer held that the loss is not admissible as per provisions of Section 43(5)(d) of the Income Tax Act and may disallowance of Rs. 5,03,94,883/-. The Assessing Officer also made disallowance u/s 14A in terms of Rule 8D for Rs. 13,26,721/-. 4. Being aggrieved by the assessment order, the assessee filed appeal before the CIT (A). The CIT (A) allowed the appeal of the assessee. 5. The Ld. DR submitted that the assessee is a non banking financial institute and the Assessing Officer rightly disallowed mark to market losses by relying up....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ntained by the appellant-company along with all the supported documents related to each transactions were also produced where the contract number, period of purchases and expiry period of contract and on what date the sale is effected and what profit or loss earned on each derivative transactions are covered. It have no dispute that the transactions were rendered through recognized registered brokers and notified exchange and each transactions was carried out electronically on screen basis system and the learned A.O. had failed to prove the factum that entries in respect of such transactions were sham particularly where it were stated by filing letter dated 20/02/2014 that "in case if still any clarification is required please let us know s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ore, Ground No. 1 and 2 of the Revenue's appeal are dismissed. 8. As regards Ground No.3, the CIT(A) held as under:- "I have gone through the A.O.'s order where I do not find anywhere the finding might have been given by him for the expenses incurred by the appellant-company related to dividend income. There is no borrowed money utilised for such investment. Hence, no interest paid. That keeping in view the cited cases by A.R. which includes the Supreme Court decision where it is held "For attracting Section 14A there has to be a proximate cause for disallowance which is in relationship with the tax-------- exempt income. " The appellant company got unsecured interest free loan of Rs. 67,04,10,000/- from holding co. Awaita P....