9911796707
TMI Blog2016 (1) TMI 1121X X X X Extracts X X X X X X X X Extracts X X X X ..... he above decision and we respectfully following the same delete the disallowance to the extent of ₹ 2,47,413/- out of ₹ 3,19,081/- which is calculated by taking into account those investments which yielded tax free dividend and only disallowance to the extent of ₹ 71,668/- is sustained. The AO is directed accordingly. - Decided partly in favour of assessee. Allowance being PMS fee paid to Enam Securities Direct Pvt Ltd for sale and purchase of shares as part of short term capital loss and allow carry forward of the same - whether the expenses incurred in connection with PMS fee to portfolio manager is an expense which is incurred in connection with the share transfer or relates to dividend income which is exempt? - Held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d raised in the appeal reads as under:- I. Expenses disallowed u/s.14A r.w.r. 8-0 - ₹ 6,20,6711- (Net disallowance ₹ 3, 19 ,081/-) 1. Since the Dividend Tax is paid by the Company, the said Dividend Income has suffered the tax and unlike other Exemptions, Dividend Income is not exempt but its there to avoid double taxation and hence sec.14A is not applicable and no disallowance is called for, therefore, ₹ 3, 19,081/- (proposed ₹ 6,20,6711- ) be deleted in full. 2. Without prejudice to above, your appellant submits as under: a) The learned CIT(A) erred in not appreciating the facts and the law on the subject and confirming the additional expenses disallowed u/s.14-A r.w.r. 8-0 - ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allocation of the PMS fees between Long Term Capital Gain (Loss) and Short Term Capital Gain (Loss). He erred in confirming the Assessment Order treating the entire said expenses of ₹ 2,92,156/- against the Dividend Income and not allowing the allocation thereof to the Long Term Capital Gain (Loss) and Short Term Capital Gain (Loss). b) Your appellant submits that the PMS Fees is to be held as against the Long Term Capital Gain (Loss) and Short Term Capital Gain (Loss) and accordingly the Short Term Capital Loss be allowed to be carried forward should be inclusive of the relevant PMS fees of ₹ 1,54,806/- and the total amount of Short Term Capital Loss of ₹ 32,35,358/- be allowed to be carried forward. c) Your ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and ₹ 3,19,081/- @ % of the average investments. 5. The aggrieved by the order of AO , the assessee carried the matter before CIT(A) who also dismissed the appeal of the assessee by confirming the order of AO by holding that the purpose of the provisions of section 14A r.w.r. 8D is to prevent the claim of expenses which relates exempt income and AO had rightly applied the provisions of section 14A r.w.r. 80D of the Act. 6. The ld AR submitted before us that the disallowance of ₹ 3,19,081/- made by the AO and confirmed by CIT(A) was totally wrong and excessive. The ld counsel for the assessee submitted that the assessee suo motto disallowed ₹ 9,434/- on account of bank charges which were only incurred in relation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - out of ₹ 3,19,081/- which is calculated by taking into account those investments which yielded tax free dividend and only disallowance to the extent of ₹ 71,668/- is sustained. The AO is directed accordingly. 9. The issue raised in the second ground is against not allowing ₹ 1,54,806/- being PMS fee paid to Enam Securities Direct Pvt Ltd for sale and purchase of shares as part of short term capital loss and allow carry forward of the same. 10. The facts in briefs are that the assessee paid PMS fee of ₹ 2,92,156/- to Enam Securities Direct Pvt Ltd for port folio management and apportioned the said fee between long term and short term loss in the proportion of the said losses. ₹ 1,54,806/- pertained t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- as PMS fee to Enam Securities Direct Pvt Ltd for portfolio management of the assessee and the assessee allocated and apportioned the said fee between long term capital loss and short term capital loss in proportion to the amount of losses. ₹ 1,37,350/- was allocated to LTCL and ₹ 1,54,806/- was apportioned to STCL. The AO disallowed ₹ 1,54,806/- the part of the PMS Fee attributed to STCL and did not allow the carried forward of STCL to the tune of ₹ 1,54,806/-.Now the issue before us whether the expenses incurred in connection with PMS fee to portfolio manager is an expense which is incurred in connection with the share transfer or relates to dividend income which is exempt. The provisions of section 48(i) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
