9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (7) TMI 901 - AT - Income TaxDisallowance u/s 14A r.w. Rule 8D Held that - As decided in DCIT Versus Subhkam Monetary Services (P) Ltd. 2012 (5) TMI 310 - ITAT, Mumbai , the same has been followed - the matter has been remitted back to the AO with the direction to compute disallowance to be made u/s 14A of the Act on a reasonable basis by following the decision GODREJ AND BOYCE MFG. CO. LTD. Versus DEPUTY COMMISSIONER OF INCOME-TAX AND ANOTHER 2010 (8) TMI 77 - BOMBAY HIGH COURT - the provisions of Rule 8D is not applicable to the instant year Decided in favour of Assessee. Purchase and sale of shares treated as STCG and not business income Held that - CIT(A) has reversed the decision of the assessing officer by following his order passed for the immediately preceding year - the contention of the assessee is that the facts that prevailed in the immediately preceding year are materially different from the facts available in the instant year there was not be any dispute that the question whether the income arising on sale of shares is assessable as Capital Gains or Business Income may be required to be examined every year by following various criterion illustrated by the Courts - assessee has filed additional evidences, they are required to be examined at the end of the AO thus, the matter is remitted back to the AO for fresh adjudication Decided in favour of Revenue.
Issues Involved:
1. Disallowance made under section 14A of the Income Tax Act, 1961. 2. Assessment of income arising from the sale of shares as Short Term Capital Gain or Business Income. Analysis: Issue 1: Disallowance under Section 14A of the Income Tax Act, 1961 The case involved cross-appeals against the order passed by the Ld CIT(A) related to the assessment year 2007-08. The primary contention was the disallowance made under section 14A of the Act. The assessee argued that Rule 8D was not applicable to the year under consideration based on a decision by the jurisdictional Bombay High Court. The Tribunal had previously set aside a similar issue in the assessee's case for the preceding year, directing the AO to compute the disallowance on a reasonable basis following the High Court's decision. Consistent with this, the Tribunal set aside the issue to the AO for reevaluation, emphasizing that Rule 8D was not applicable for the year in question. Issue 2: Assessment of Income from Sale of Shares The second issue revolved around the assessment of income arising from the sale of shares as either Short Term Capital Gain or Business Income. The revenue contested the CIT(A)'s decision, citing differences in facts from the preceding year. The assessee submitted additional evidence for consideration. The Tribunal noted the reversal of decisions between the CIT(A) and the AO in the current and preceding years. Acknowledging the need for a fresh examination each year to determine the nature of income from share sales, the Tribunal allowed the assessee's plea to set aside the issue to the AO. The Tribunal directed the AO to reevaluate the issue considering the additional evidence and granting the assessee a fair hearing, emphasizing the importance of examining the facts specific to the year under consideration. In conclusion, both the revenue and the assessee's appeals were treated as allowed for statistical purposes, with the Tribunal emphasizing the need for a fresh examination of issues each year based on the specific facts and evidence presented.
|
