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TMI Blog2014 (6) TMI 883X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. All these activities are carried on by the assessee in a composite manner. It is not the case of the assessee that the management of the assessee company and other personnel are not looking after the investment portfolio. All the activities are going on side by side. Therefore, a reasonable portion of the expenditure incurred for the management and administration of the business of the assessee is necessarily attributable to earning of exempted income. Therefore, the lower authorities are justified in making disallowance from the exempted income towards expenditure attributable to earning of that exempted income. Short term capital gains or business income - Held that:- shares were sold by the assessee company, as investment and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year 2007-08. The appeal is directed against the order passed by the Commissioner of Income-tax(Appeals)-III at Chennai, on 13.03.2013. The appeal arises out of the assessment completed under sec.143(3) of the Income-tax Act, 1961. 2. We heard Shri Anand, the learned counsel appearing for the assessee and Shri S. Das Gupta, the learned Joint Commissioner of Income-tax appearing for the Revenue. 3. The income of the assessee for the impugned assessment year included among other things, dividend income and long term capital gains on sale of shares. Both these income are exempt from taxation. Dividend income was ₹ 14,76,123/- and long term capital gains was ₹ 33,50,975/-, totaling to ₹ 48,27,098/-. The Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t year 2007-08(as argued by the assessee), it is within the competence of the Assessing Officer to invoke sec.14A and make a reasonable disallowance towards expenditure, depending on the facts and circumstances of the case. The assessee is a share broker. The assessee is earning dividend from investment made by it. Long term capital gains were derived from the shares held by the assessee. All these activities are carried on by the assessee in a composite manner. It is not the case of the assessee that the management of the assessee company and other personnel are not looking after the investment portfolio. All the activities are going on side by side. Therefore, a reasonable portion of the expenditure incurred for the management and adminis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see. Secondly, we have also seen that the assessee has earned long term capital gains on sale of shares. Therefore, it is clear from the facts of the present case that the assessee is carrying on business of share broking and also activities of investing in shares. The contention of the assessee has to be examined in the above scenario. The assessee has clearly stated that it is maintaining a separate portfolio for investment in shares and a separate portfolio for its regular business of share broking. Even though books of account are not maintained separately, independent details are discernible from the books of account maintained by the assessee on the dual activities of the assessee. The assessee has maintained necessary particulars reg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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