9911796707
TMI Blog2012 (12) TMI 630X X X X Extracts X X X X X X X X Extracts X X X X ..... these two appeals simultaneously by way of this common order for the sake of convenience. 2. At the outset, the learned Counsel for the assessee pointed out on the Revenue's appeal that the issue has been adjudicated by this Tribunal in assessee's own case on the facts and circumstances which have been reiterated by the learned CIT(A) vide his order dt.19.11.2008 for the Assessment Year 2005-06 on the order u/s.143(3) when the Tribunal in ITA No.25/CTK/2009 dt.31.10.2010 have categorically held that the addition by applying the provisions of Section 2(22)(e) was not to be made which the learned CIT(A) in the impugned Assessment Year has given a finding following the Tribunal order in para 6.2 of his order may kindly be perused. 3. The lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r passed by the Assessing Officer u/s.143(3) was completed on 24.12.2007. The Assessing Officer found that as per AIR (annual information return) information, it was found that the assessee had paid Rs. 9,99,99,800 for purchase of equity shares of NTPC Ltd. through Kotak Mahindra investment. However, the balance sheet of the assessee as on 31.03.2005 reflected only Rs. 50,82,770 as investment in NTPC ltd. Assessee was asked to produce the complete detail of investment made in NTPC Ltd. during the concerned year. In his reply, the A/R of assessee stated that NTPC Ltd allotted only 135150 equity shares worth Rs. 91,40,803 duly reflected in the Investment in Shares ledger account and per share cost comes to Rs. 67. The assessee also mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the year was calculated by the assessee to be Rs. 8,40,047. The learned Assessing Officer thereafter held that as the cost of each share of NTPC allotted to the assessee was Rs. 62 and not Rs. 67, revised profit on sale of 60,000 shares which would be as under: Net sale proceeds of 60,000 shares Rs. 48,95,519 Less: Cost of Acquisition (c) Rs. 62 Rs. 37,20,000 Less: STT paid by assessee Rs. 3,685 Actual Profit Rs. 11,71,834 On the above basis, the Assessing Officer added the differential amount of Rs. 3,31,787 to the total income of assessee. 7. Aggrieved the assessee appealed before the first appellate authority who in a brief order has confirmed the same by holding a view that the nature of expenses are such that they are revenue i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer was purely an imaginary figure having no basis whatsoever either in the books of account for the purpose of computation of capital gains nor for the purpose of disallowance of expenditure on the purported earning of dividend income under the provisions of Section 14A read with Rule 8DD of the I.T.Rules. As per the AIR information, the appellant paid Rs. 9,99,99,800, for purchase of equity share of NTPC Ltd. through Kotak Mahendra Investment Ltd. The appellant has deposited Rs. 2,00,00,000, with Kotak Mahendra Investment Ltd. for purchase of NTPC share. Since the share of reputed Company like NTPC is always over-subscribed, the allotment is made on prorata basis. Kotak Mahendra Investment Ltd. was handling the investment in share o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o make an extra income of Rs. 3,31,787 which was a total imaginary figure brought to tax by the Assessing Officer. The observation of the learned CIT(A) rather clinches the issue in favour of the assessee insofar as the question of allowing revenue expenditure from income from other sources was purely a hypothetical figure or to be considered for adjudication of the issue u/s.4A when the learned CIT(A) had already considered the case of the assessee on the ground for deleting the disallowance of expenditure amounting to Rs. 4,06,160 brought to tax by the Assessing Officer in the manner for computation u/r.8DD of the I.T.Rules r.w.s. 14A of the I.T.Act. 9. In view of the above, we are of the considered view that it was a fit case when two i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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