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TMI Blog2018 (8) TMI 1719X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of business or profession” arising from transaction chargeable to securities transaction tax, he shall be allowed deduction of an amount equal to the securities transaction tax paid by him in respect of transactions chargeable to securities transactions tax entered into in the course of business during that previous year. From the amount of income tax on such income arising from such transaction. An assessee is eligible for deduction from the amount of income tax on such income arising from such transactions computed in the manner provided in section 88E of the Act i.e. an equal amount to the securities transaction paid by him in respect of taxable securities transaction entered into in the course of business during the previous year. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication order passed by Assessing Officer u/s 154, disregarding the legal position that when the issue is debatable or two views are possible or the issue involves a long drawn process of reasoning, it cannot be subject matter of rectification under section 154. 2. Without prejudice to the above, in the facts and in circumstances of the case and in law, the Learned CIT(A) has erred in confirming the action of Assessing Officer in restricting the rebate u/s 88E at ₹ 22,70,512/- as against ₹ 30,93,497/- claimed by the appellant and allowed in assessment." 3. Briefly stated facts are that the assessee company is engaged in the business of share trading and also investment and assessment was completed by the AO in the case of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Your company is broker in NSE and is also engaged in trading of securities. The assessment for AY 2008-09 was completed after scrutiny, assessing total taxable income at ₹ 7.75 lakhs, wherein the department had allowed rebated under section 88E of ₹ 30,93,497/- as claimed. It is observed from the record that your income during the financial year 2007-08 consisted of following: Income from share treading 93,51,369 Interest income 2,44,256 Interest income 26,68,539 Short term capital gain 49,2,136 Total assessed income 1,71,76,300 Thus on the above assessed income the average rate of tax work out to 24.28% as detailed below tax on income excluding STCG ₹ 1,22,64,164x30%=36,79,249/-tax on STCG of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 43(3) of the Act. The AO has to go through the definition of total income as given in the provisions of section 111A of the Act, since during the year under consideration, the assessee has also earned income by way of short term capital gains on which the assessee has paid STT and therefore, while computing the rebate, income from such short term capital gains should have to be reduced. Before us, the learned Counsel for the assessee filed copy of Tribunal's order in the case of DCIT vs M/s Malhar Traders Pvt. Ltd. in ITA No. 707/Mum/2011 for AY 2007-08, wherein Tribunal has categorically held that to invoke sub section 88E of the Act, which clearly provides that the deduction of security transaction paid would be in total if the total inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rate of income tax " as used in sub- section (2) has to be reckoned as average rate of income tax on business income only. Thus, we do not find any merit in the ground raised by the Department as the directions given by the learned Commissioner (Appeals) is in accordance with the provisions of the law. Thus, the grounds raised by the Revenue are dismissed." 6. In the present case also, we find that the AO has computed the income while passing order under section 154 of the Act as under: - "Assessing Officer's calculation in order under section 154 Total PGBP as per assessment order 22,64,165 Less Brokerage income 2,44,256 Less Interest income 26,68,539/- PGBP from transaction in securities liable to STT 93,51,370/-." 7. The l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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