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TMI Blog2010 (5) TMI 826X X X X Extracts X X X X X X X X Extracts X X X X ..... the sake of convenience., I.T.A. No. 4178/Mum/2009 (A.Y. 2005-06): 2. Grounds of appeal No. 1 by the Revenue reads as under: I. On the facts and circumstances of the case and in law, the CIT(A) erred in allowing the penalty of ₹ 13,16,099/- levied by Stock Exchange SHC Ltd., and N?SCCL. The Ld. CIT(A) failed to appreciate that the penalty levied by Stock Exchange, SHC Ltd. and NSCCL is for the office for violation of the law. 3. After hearing both the sides, we find the Assessing Officer disallowed an amount of ₹ 13,16,099 being penalties/fines paid by the assessee to Bombay Stock Exchange amounting to ₹ 39,494, Stock Holding Corporation of India Ltd. amounting to ₹ 35,939 and NSCCL amounting to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nclature raised paid page 10 of the paper book and same is levied for violation of the margins imposed by the SEBI on the share brokers. We have also examined the importance of the margin imposed by the SEBI in this regard. As seen from the notifications issued by the SEBI. We find that such margins are imposed in order to reduce the risk components and, therefore, these are basically risk management oriented penalties, which are routine in nature. We also find that these violations are offer by payment of penalty as in the instant case. Having regard to the purpose of the provisions of section 37(1) which is aimed at providing deterrence for infraction of Acts of the country, the violation as in the instant case, are not found to attract t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer disallowed an amount of ₹ 2,50,460 claimed by the assessee as sundry balances written off on the ground that the conditions of section 36(1)(vii) r.w.s. 36(2) are not met and, therefore, deduction cannot be allowed on the same as a bad debt. Similarly he also disallowed the same as business loss in absence of details. 11. Before the CIT(A), it was submitted that these are brokerage differences, valan account differences which were written off. The ledger accounts of all these parties were filed before the CIT(A). Based on the arguments advanced by the assessee, the CIT(A) held that the assessee has declared total income of ₹ 25.12 crores in the return of income and has extremely huge turnover and the val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uming the same as bad debt written off. However, it is the contention of the assessee that the same is on account of rounding up of such income and there are both positive and negative items and only the net amount has been written off which is consistently being followed by the assessee company. Since the Assessing Officer has not considered the same from this angle and since the order of the CIT(A) is also very brief and cryptic, we, in the interest ofjustice, deem it proper to restore the issue to the file of the Assessing Officer for fresh adjudication of the issue. Needless to say, the Assessing Officer shall give due opportunity of being heard to the assessee and decide the issue as per law. Grounds of appeal No. 2 by the Revenue is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee claimed long term capital loss amounting to ₹ 33,33,333 arising on account of redemption of 2,00,000, 8% non cumulative redeemable preference shares of face value of ₹ 100/- of Alliance Holding Pvt. Ltd. These shares were redeemed at par during the year under assessment and long term capital loss was computed by indexing the cost of acquisition of shares. The assessee filed a detailed written submission in this regard. On perusal of the assessee s assessment records of earlier years, the Assessing Officer noted that similar losses on account of redemption of preference shares were disallowed in the orders u/s. 143(3) for A.Y. 2002-03 and 2004-05. He also noted that these disallowances were deleted by the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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