TaxTMI 
TaxTMI 
TaxTMI 
2021 (11) TMI 40
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....nces of the case and provisions of the law, the Ld. AO as well as Ld. CIT(A) erred in making/confirming the disallowance of Rs. 97,84,459/- u/s. 14A read with Rule 8D of IT Act against the exempted income of dividend and tax free income of Rs. 1,28,58,978/-. 3. That without on the facts and circumstances of the case and provisions of the law, the Ld. AO as well as Ld. CIT(A) erred in making/confirming the disallowance of Rs. 62,06,818/- in respect of amortisation of premium paid at the time of purchase of securities over the remaining period of securities. 4. That the appellants request be allowed to add, modify and delete any other ground (s) of appeal. 2. Facts giving rise to the present appeal are that the case of the assessee was p....
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....e assessee submitted that both the authorities below have failed to appreciate the fact in right perspective. He submitted that no disallowance in respect of interest expenditure u/s. 14A of the Act could be made where the assessee had sufficient funds to make the investment out of own surplus interest free funds. He submitted that the reliance as placed by the Ld. CIT(A) on the judgement of Hon'ble Supreme Court rendered in the case of Maxopp Investment Ltd. vs CIT in Civil Appeal Nos. 104-109 of 2015 is misplaced. He submitted that on the contrary, this judgement helps the assessee's case. He further submitted that the assessee is a banking company and investment in share and securities is a regular business activity of the assess....
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....s of banking. This Circular came to be issued in the aftermath of CIT Vs. Nawanshahar Central Cooperative Bank Ltd. wherein this Court had held that investments made by a banking concern is part of their banking business. Hence the income earned through such investments would fall under the head Profits & Gains of business. The Punjab and Haryana High Court, in the case of Pr. CIT, vs. State Bank of Patiala while adverting to the CBDT Circular, concluded correctly that shares and securities held by a bank are stock in trade, and all income received on such shares and securities must be considered to be business income. That is why Section 14A would not be attracted to such income. 26. Reverting back to the situation here, the Revenue does....
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....l work - The Wealth of Nations may aptly be quoted: "The tax which each individual is bound to pay ought to be certain and not arbitrary. The time of payment, the manner of payment, the quantity to be paid ought all to be clear and plain to the contributor and to every other person." Echoing what was said by the 18th century economist, it needs to be observed here that in taxation regime, there is no room for presumption and nothing can be taken to be implied. The tax an individual or a corporate is required to pay, is a matter of planning for a tax payer and the Government should endeavour to keep it convenient and simple to achieve maximization of compliance. Just as the Government does not wish for avoidance of tax equally it is the ....
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....he contention of the assessee and sustained the addition. He contended that law is well settled law that amortization premium is in the nature of revenue expenditure and hence, allowable. In support of this, Ld. Counsel for the assessee placed reliance on various judicial pronouncements. 13. On the contrary, Ld. Sr. DR opposed these submissions and supported the orders of the authorities below. 14. We have heard the rival contentions and perused the material available on record. The Co-ordinate Bench of this Tribunal in ITA No. 1334/Ahd/2014 & Others in the case of The Chanasma Nagrik Sahakari Bank Ltd. vs ACIT decided the identical issue by observing as under:- 15. "As regards claim of amortization of securities premium amounting to Rs....