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TMI Blog2015 (7) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... ck to AO. He is directed to make fresh calculation after considering the submissions of the assessee. - Decided in favour of assessee for statistical purposes. Rebate available u/s. 88E - Held that:- In the case of Ashika Stock Broking Ltd. (2010 (11) TMI 555 - ITAT, Kolkata) it was held that once there was a net surplus from share dealing of market segment and future and option segments together and if there was a net profit therefrom the assessee was entitled for rebate of entire STT. In the case under consideration surplus from share dealing from market segment/ future and option segment is not there, but there is net income after setting off of losses. We are of the opinion that once there was overall profit for the AY under consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er erred in this connection in holding that: a)the Appellant has not maintained separate records for expenses incurred for earning exempt income; b) the burden is not on the Assessing Officer [AO] to establish nexus of the expenditure with exempt income; c) the Appellant s contention that Section 14A does not provide for apportionment of expenses is not sustainable; d ) the Appellant has failed to produce any cash flow statement to show that borrowed fund has not been utilized for making investment; and e) the Appellant s contention that it has incurred no expenditure to earn the exempt income is not acceptable. (4) The CIT(A) erred in sustaining the computation of the rebate by the AO under Section 88E at ₹ 75,07,27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me, that the appellant had failed to produce any cash flow statement or any other material which could establish that borrowed fund had not been utilised for earning of exempt income, that merely on the basis of balance of own fund and borrowed fund as on the date of the balance sheet it could not be presumed that borrowed fund had not been utilized for earning of exempt income, that the appellant s contention that no expenditure had been incurred to earn exempt income was not acceptable, that the assessee being a share trade undertook transactions of share which subsequently yielded dividend of capital gain and same was exempt, that the expenses including interest and administrative expenses debited to Profit and Loss Account included expe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the AO. Considering the above we are of the opinion that matter should be restored back to AO. He is directed to make fresh calculation after considering the submissions of the assessee. Ground No.1 is partly allowed. 5. Next ground is related with rebate available u/s. 88E of the Act. During the course of assessment proceedings, the assessee was asked by the AO to submit the working of rebate claimed in respect of securities transaction tax amounting to ₹ 1,01,87,300/-. He found that though the assessee had applied average rate on income, but the average rate was adopted before setting off business loss of earlier years. With regard to rebate claimed u/s.88E of the Act, the AO held as under : In the instant case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section has to be calculated in background of the provisions of Sec. 87(2) of the Act as discussed in next paragraph. We have considered the case laws cited before us. In the case of Oasis Securities facts were as under : During the course of assessment proceedings AO noted that the assessee had income of ₹ 1.92 Crores from speculation business in respect of which STT was paid, that said income was set off against brought forward speculation losses leaving no taxable income from security transactions. Considering these facts he held that rebate u/s. 88E was not allowable. FAA upheld the order of the AO. His order was challenged before the Tribunal. After considering the issue at length ITAT held: 14.It is simple and plain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t arise. The ground fails. Clearly, the facts of the case under consideration are different from the facts of Oasis securities Ltd (supra). 7. In the case of Ashika Stock Broking Ltd. (supra) it was held that once there was a net surplus from share dealing of market segment and future and option segments together and if there was a net profit therefrom the assessee was entitled for rebate of entire STT. In the case under consideration surplus from share dealing from market segment/ future and option segment is not there, but there is net income after setting off of losses. We are of the opinion that once there was overall profit for the AY under consideration, rebate under section 88E of the Act had to be allowed. Following the order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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