2022 (2) TMI 976

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.... the exempt dividend income and taxing the same as 'Dividend Stripping' u/s. 94(7) of the Income Tax Act, and consequently reducing the loss claimed by the Appellant by Rs. 1,45,547/-." 2. The facts giving rise to the present appeal are that in this case the original return of income declaring income of Rs. 31,59,720/- was filed on 28.07.2016. Thereafter a revised return of income declaring total income of Rs. Nil was filed on 17.10.2016. The case was selected for scrutiny under CASS. Thereafter a notice u/s. 143(2) was issued and served upon the assessee. In response thereto the authorized representative of the assessee appeared on behalf of the assessee and submitted the details. The Assessing Officer while framing the assessme....

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....ed the appeal, thereby the addition of Rs. 29,532/- in respect of disallowance of the expenses was deleted. However, the ground relating to disallowance of Rs. 1,45,547/-, on account of exempt dividend income u/s. 94(7) was rejected and the view of the Assessing officer was sustained. Aggrieved against this the assessee is in appeal before this Tribunal. 4. Learned counsel for the assessee vehemently argued that the authorities below failed to appreciate the facts in right perspective. He contended that provisions of section 94(7) of the Act would not be applicable under the facts and circumstances of the present case. He contended that the explanation offered was brushed aside without assigning any reason. He, therefore, prayed that add....

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....ion of loss is sustained." 8. It is seen that the assessee has also filed written synopsis. The relevant contents are reproduced as under: "4. Contrary to the observation of the Learned CIT(A), we had in fact mentioned at page No. 5 of our submission and submitted a statement as Annexure D at page No. 43 with further details placed at page No. 44,45,46 (refer page Nos. 5 to 8 of Annexure A) the details of dividend from shares and mutual funds of Rs. 5,55,414.50. Out of this an amount of Rs. 4,09,867/- was credited to the profit and loss account. The remaining amount of Rs. 1,45,547/- was clearly out of the scope of section 94(7) of the IT Act, 1961, as an amount of Rs. 1,78,404/- (being more than Rs. 1,45,547/-) was on account o....