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TMI Blog2019 (12) TMI 1600X X X X Extracts X X X X X X X X Extracts X X X X ..... he issue is squarely covered by the decision of Maxoop Investment Ltd [ 2018 (3) TMI 805 - SUPREME COURT] as held that when the share are held as stock in trade, it becomes the business activity of the assessee. Whether the dividend earned or not is immaterial. It would be quirk of fate if the dividend is received. The Hon ble Supreme Court thus held that in such cases there cannot be any disallowance u/s 14A of the Act. Thus, the fact is not denied that assessee is holding exempt income generating investment as stock in trade, the disallowance made by the ld Assessing Officer and confirmed by the ld CIT(A) is not sustainable. Accordingly, we direct the ld Assessing Officer to delete the disallowance u/s 14A of the Act. Deduction u/s 36(1)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by us in the appeal of the assessee wherein, we have directed to delete the disallowance, this ground of appeal of revenue is also deserves to be dismissed. Accordingly, ground No. 2 of the appeal is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... rther held that in absence of separate account the claim of the assessee that it has not incurred any expenditure for earning exempt income is not acceptable. AO further rejected the contention of the assessee that if tax is withheld u/s 115O, section 14A does not apply. He accepted that since assessee has no opening or closing balance of investments disallowance as per Rule 8D cannot be made. He disallowed 10% of the dividend receipt u/s 14A of the Act. 7. Ld CIT(A) also upheld the same despite the fact it was submitted that investments are held by assessee as stock in trade. In the present case the issue is squarely covered by the decision of the Hon‟ble Supreme Court in Maxoop Investment Ltd Vs. CIT 402 ITR 640 wherein, in para No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we direct the ld AO to delete the disallowance u/s 14A of the Act. Accordingly, ITA No. 2124/Del/2015 filed by the assessee is allowed. 12. Now we come to the ITA No. 2810/Del/2015 filed by the revenue. 13. The first ground of appeal is against the deletion of deduction disallowed by the ld Assessing Officer of Rs. 12072496/- u/s 36(1)(viii) of the Act. 14. The brief facts of the case is that assessee has claimed deduction of Rs. 11 crores u/s 36(1)(viii) of the Act the ld Assessing Officer out of that allowed only Rs. 97927504/- applying proportion of receipt total business income of the assessee in the granted deduction on account of interest on long term housing loan to the total income of the assessee. In the case of the assessee int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sent case the methodology adopted by the assessee is consistently followed for last eight years. Same was accepted by the revenue without any objection. The only issue is with respect to how the profit of the business for the purpose of long term housing finance shall be worked out. The only issue is that assessee is computed with respect to the total income with respect to the interest income whereas the ld AO has applied the above ratio to the total receipt. When the method has been consistently accepted for the above year we do not find any reason to defer from that. In view of this we do not find any infirmity in allowing the assessee claim of deduction u/s 36(1)(viii) of the Act applying the ratio of 62.75%. In the result we do not fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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