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2016 (12) TMI 1548 - AT - Income TaxTDS u/s 194J - Non deduction of tds on transaction charges paid to stock exchanges - Held that - Since both the revenue and the assessee were under the bonafide belief for nearly a decade that tax was not deductible at source on payment of transaction charges, no fault can be found with the assessee in not deducting the tax at source in the assessment year in question and consequently disallowance made by the assessing officer under Section 40(a)(ia) of the Act in respect of the transaction charges cannot be sustained. See Kotak Securities Ltd. case 2011 (10) TMI 24 - Bombay High Court - Decided in favour of assessee Treatment to loss on sale of shares of subsidiary company as business loss on the ground that the same has erroneously been treated as capital loss by the assessee - Held that - Admittedly, the AO has passed the assessment order on the basis of the facts represented by the assessee and the assessee did not raise this issue even before the CIT(A) during appeal proceedings. Under these circumstances, the assessee cannot raise this issue before the Tribunal. In our considered opinion since this is not a legal ground the same cannot be admitted as an additional ground at this stage. Hence, we dismiss this ground of appeal.
Issues Involved:
1. Proper opportunity of being heard not afforded to the appellant. 2. Disallowance of loan amount written off by the appellant to its subsidiary company. 3. Disallowance of transaction charges paid to exchanges under section 40(a)(ia). 4. Condonation of delay in filing the appeal. Analysis: Issue 1: Proper opportunity of being heard The appellant contended that the order was bad in law as proper opportunity of being heard was not provided. The issue related to the disallowance of a loan amount written off by the appellant to its subsidiary company. The appellant sought restoration of this issue to the file of the CIT(A) for adjudication. The Tribunal observed that the CIT(A) had not given any finding on this issue. Consequently, the matter was remanded to the CIT(A) for further consideration after affording an opportunity of being heard to the assessee. Issue 2: Disallowance of loan amount to subsidiary company The appellant challenged the disallowance of the loan amount written off to its subsidiary company. The Tribunal found that the CIT(A) had not adjudicated this issue. Therefore, the matter was remanded to the CIT(A) for fresh consideration. Issue 3: Disallowance of transaction charges Regarding the disallowance of transaction charges paid to stock exchanges under section 40(a)(ia), the Tribunal referred to a similar case where the issue was decided in favor of the assessee. The Tribunal held that since the facts and issues were identical to the previous case, and the bona fide belief of the assessee was accepted, the disallowance under section 40(a)(ia) should not be made. The Tribunal set aside the findings of the CIT(A) and decided this ground of appeal in favor of the assessee. Issue 4: Condonation of delay The appellant filed an application for condonation of delay in filing the appeal. The Tribunal, considering the principles laid down by the Hon'ble Supreme Court, allowed the condonation of delay as it was satisfied that there was sufficient cause for the delay. The Tribunal permitted the appellant to argue the case on merits after condoning the delay. In conclusion, the Tribunal partly allowed the appeal for the assessment year 2009-10, remanding certain issues to the CIT(A) for fresh consideration while deciding in favor of the assessee on the issue of disallowance of transaction charges. The Tribunal dismissed the additional ground raised by the appellant regarding the treatment of loss on sale of shares.
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