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TMI Blog2021 (11) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... nsactions and the manner of maintaining books of accounts plays an important role in determining the nature of transaction. Also, as depicted by the Circular No. 06/2016, in the present case, the appellant has treated the shares as investment and not as stock-in-trade and there are no fine grounds to say that the appellant is a dealer in shares and not an investor especially when the sale of shares was a single solitary transaction - Decided against revenue. Disallowance u/s. 14A - assessee has disallowed an amount suo-moto as expenses attributable to the earning of the exempt dividend income - HELD THAT:- We find that the Ld. CIT(A) only directed the A.O. to verify entire investments and exclude investments which has no exempt income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that it is a personal in nature therefore, the Ld. CIT(A) rightly deleted the addition made by the A.O. By considering the above order passed by the Ld. CIT(A), we find no infirmity in the order passed by the Ld. CIT(A). Revenue appeal dismissed. - ITA No. 2138/Chny/2017 - - - Dated:- 24-9-2021 - SHRI V. DURGA RAO , JUDICIAL MEMBER AND SHRI G. MANJUNATHA , ACCOUNTANT MEMBER For the Appellant : G. Johnson, Addl. CIT For the Respondents : Sanjeev Aditya M. , CA ORDER Per V. Durga Rao , Judicial Member This appeal filed by the Revenue is directed against the order of the learned Commissioner of Income Tax (Appeals)-15, Chennai in I.T.A. No. 750/2013-14/A.Y. 2011-12/CIT(A)-15 dated 20.06.2017 relevant to the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, the A.O. is not justified in treating the transactions as a business transaction and the income arising out of the transaction is a business income and he strongly supported the order passed by the Ld. CIT(A). 8. On the other hand, the Ld. Departmental Representative strongly supported the orders passed by the A.O. 9. We have heard both the sides, perused the materials available on record and gone through the orders of the authorities below. In this case the assessee has purchased shares of Induslnd Bank on 18.12.2009 and sold the same on 23.03.2011. The holding period of the shares is more than 12 months and only single activity carried by the assessee. In the balance sheet also it has shown as an investment. In view of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sheet and not as stock-in-trade. Also, the appellant has also made a reference to the Circular No. 4/2007 which clearly makes a distinction between 'capital asset' and a 'trading asset' and states that where the appellant has entered into a single transaction of purchase and sale of shares, the same shall not tantamount to business activity and shall be investment activity and such income to be charged as capital gains only. Further, the appellant has placed reliance on CBDT Circular No. 06/2016 dated 29.02.2016 which states that in respect of listed shares and securities held for a period of more than 12 months immediately preceding the date of transfer, if the assessee decides to treat the income from transfer thereof as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of ₹ 1,21,32,09,086/- and received a tax exempt dividend income of ₹ 1,01,89,949/-. The assessee has disallowed an amount of ₹ 33,09,000/- as expenses attributable to the earning of the exempt dividend income. The A.O. did not accept the disallowance made by the assessee and he has invoked s. 14A of the Act and r/w. Rule 8D(2)(iii) of the Income Tax Rules, 1963(sic 1962) (hereinafter as the Rules ) and disallowed an amount of ₹ 70,71,281/-. On appeal, the Ld. CIT(A) partly allowed the grounds raised by the assessee by directing the A.O. partly allow the appeal. The relevant portion of the order is extracted as under: 1.3. I have considered the above submissions and on perusal of the above facts and circumst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avelling, boarding, lodging, credit card expenditure. The case of the A.O. is that the assessee's registered office is situated in Delhi, there is no purpose of holding the Board meeting in Chennai therefore, there is no necessity in conducting the Board meeting in Chennai and he is of the opinion that the expenditure is personal in nature and disallowed the same. Before the Ld. CIT(A), it is submitted that the company has its subsidiary and associated office is in Chennai and some of the Directors are based in Chennai therefore, the Board meeting was conducted in Chennai. The Ld. CIT(A) by considering the above, he directed the A.O. to delete the addition. 14. We find that when the assessee is having subsidiary and associated office ..... X X X X Extracts X X X X X X X X Extracts X X X X
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