TaxTMI 
TaxTMI 
2016 (9) TMI 1541
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....rounds raised by the Revenue per its appeal are as under:- "1. That on the facts and circumstances of the case and as per law Ld. CIT(A) erred in allowing the gains generated from transaction of shares as capital gain instead of business income. 2. That on the facts and circumstances of the case and as per law Ld. CIT(A) erred in not considering the frequency of transaction in share dealing by the assessee while treating the gain as capital gain. 3. That on the facts and circumstances of the case and as per law Ld. CIT(A) erred in deleting the addition made by the AO us 14A read with rule 8D amounting Rs. 56,36,668/- for earning exempted income. 4. That on the facts and I law, Ld. CIT(A) erred in deleting the calculation made by....
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....grieved, assessee preferred an appeal before Ld. CIT(A) who treated the income of assessee under the head "capital gains" by reversing the order of AO by observing as under:- "5.2.3 I have carefully considered the submission put forth on behalf of the appellant along with the supporting documents furnished, perused the facts of the, gone through the findings of the AO and other materials brought on record. In so far as the treatment of long term capital gain and short term capital gain as business income is concerned, I find that the issue is covered in favor of the appellant by the order of the ITAT for the assessment year 2005-06 referred to above. Hence the appellant's appeal on this ground is allowed. The AO is directed to modify the....
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.... to conduct the share business when the assessee is dealing in shares and held as investment in shares which holding is not disputed by the AO, in so far as, the shares were held for more than one year was acceptable to it. This was considered in the case of CIT vs Gopal Purohit by ITAT Mumbai reported in 228 CTR 582. Similarly in the case of CIT vs R.K.Dhawan reported in 208 Taxation 393 it was held that having found that the assessee had sold the shares which was held by it as investment cannot be treated as stock-in-trade, unilaterally by the AO to be rendering income from business. Coming closer to the Tribunal decisions at Kolkata the ld.counsel had relied on various decision rendered by ITAT, Kolkata being DCIT vs M/s. Eterna Steel & ....
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....r capital gains. The appeal of the revenue stands dismissed." Since the issue is already covered in favour of assessee we do not find any reasons to interfere in the order of Ld. CIT(A). Accordingly we uphold. This ground of Revenue is dismissed. 6. Next issue raised by Revenue is that Ld. CIT(A) erred in deleting the addition made by AO for Rs. 50,36,668/- u/s 14A of the Act r.w.s. Rule 8D of the IT Rules, 1962. 7. Assessee during the year has earned income of Rs.27,54,699/- as dividend income which is exempted from tax. The assessee in terms of provisions of Sec. 14A of the Act has suo motu disallowed a sum of Rs.21,93,862/- as proportionate expense relating to income not taxable u/s. 14A of the Act. However, AO invoked the provisio....
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....in agreement with the contention of the Ld. A/R of the appellant that disallowance on account of interest is to be calculated with reference to the net amount of interest by giving credit to the interest of Rs. 90,34,07/- credited in the profit & loss account and accordingly modify the disallowance made u/s. 14A of the Act. thus, this ground of appeal is partly allowed." Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 9. Before us the ld. DR vehemently supported the order of the AO whereas the ld. AR submitted that AO has invoked the provisions of section 14A of the Act without recording the satisfaction. The ld. AR also drew our attention on page 5 of the paper book and demonstrated that the investment was m....