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TMI Blog2018 (2) TMI 1162X X X X Extracts X X X X X X X X Extracts X X X X ..... d following reasons: "(1) In this case, the assessee filed his return of income on 24/09/2010 for A.Y. 2010-11 declaring total income of Rs. 1,57,500/-. The assessee had engaged in the business of dealing in shares and mutual funds. Assessment Order u/s. 143(3) of the Act was passed on 26.03.2015 by accepting the total income at Rs. 1,57,500/-. (2) Irregular allowance of prior-period item on account of conversion of stock-in-trade to investment: On verification of case records, it is found that the assessee had executing affidavit dated 09.03.2009, converted his investment in shares, shares lying into stock-in-trade as on 09.03.2009 amounting to Rs. 9,20,69,997/- and treated accordingly in the books of account based on the market va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hare dealings, and transfers such shares to an investment account, the withdrawal of the shares should be reflected in the accounts of the business at the cost price and not at the market value of the shares." (ii) In view of the decision of the Hon'ble Supreme Court, it is seen that, in the instant case, the business loss was carried forward in the annual account only and remained outside IT scrutiny thus was not conforming to the provisions of the I.T.Act. The omission to disallow the same has resulted into underassessment of income of Rs. 2,99,32,343/- and short levy of tax of Rs. 1,20,10,302/- including interest. (3) Excess allowance of expenditure on account o the expenditure relatable to exempt income. On verification of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ale of shares. According to the Assessing Officer, such claim was not acceptable particularly in view of the judgement of Supreme Court in case of Shri Kikabhai Premchand vs. CIT reported in 24 ITR 506. The second dispute raised by the Assessing Officer in the reasons recorded is with respect to the long term capital gain on securities and the expenditure claimed by the assessee for earning such income. According to the Assessing Officer, expenditure pertaining to such exempt income was required to be disallowed under section 14A of the Act. 5. With respect to both these grounds the Assessing Officer in the reasons had begun with expression "verification of case records it is found that/seen that". Thus on both issues, the Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X
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