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DCIT, Central Circle-8, New Delhi Vs. Sahara Care Ltd, 1, Kapurthala Complex, Aliganj, Lucknow
July, 22nd 2019

Referred Sections:
Section 14 A of the income tax act
Section 35D
Section 57 of the income tax act.

Referred Cases / Judgments:
Delhi High Court in case of CIT vs Lagan Kala upvan (259 ITR 489 (Delhi).
Chemical industries Ltd vs Commissioner of income tax 213 ITR 523/–.
Shashun chemicals and drugs Ltd vs Commissioner Of Income Tax ,

 

                    INCOME TAX APPELLATE TRIBUNAL
                      DELHI BENCH "A": NEW DELHI
             BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER
                                 AND
            SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER

                         ITA No. 2477 & 981/Del/2011
                     (Assessment Year: 2005-06 & 2007-08)
                  DCIT,                Vs.        Sahara Care Ltd,
             Central Circle-8,                1, Kapurthala Complex,
                New Delhi                         Aliganj, Lucknow
                                                PAN: AAGCS9819Q
               (Appellant)                          (Respondent)



               Revenue by :                  Smt Naina Soin Kapil, Sr. DR
               Assessee by:                       Shri Rohit Jain, Adv
                                            Shri Bharath Janarthanan, Adv
              Date of Hearing                        29/04/2019
           Date of pronouncement                     18/07/2019


                                    ORDER

PER PRASHANT MAHARISHI, A. M.

1.   These are the two appeals filed by the learned Assessing Officer against the
     order of the learned COMMISSIONER OF INCOME TAX (APPEALS)  1, New
     Delhi dated 25/2/2011 for assessment year 2005  06 and 15/11/2010 for
     assessment year 2007  2008.
2.   The revenue has raised the following grounds of appeal in ITA No.
     2477/Del/2011 for the Assessment Year 2005-06

     "1.   The order of the ld CIT(A) is not correct in law and facts.
     2.    Whether on the facts and in the circumstances of the case, the CIT (A)
           has erred in deleting disallowance of Rs. 8,403/- made u/s 14A.
     3.    Whether on the facts and in the circumstances of the case, the ld CIT(A)
           has erred in deleting addition of Rs. 1,24,35,157/- on account of loss
           on sale of securities.
     4.    Whether on the facts and in the circumstances of the case, the ld CIT(A)
           has erred in deleting addition of Rs. 2,24,140/- made u/s 35D in
           respect of preliminary expenses written off during the year.
     5.    Whether on the facts and in the circumstances of the case, the ld CIT (A)
           has erred in deleting addition of Rs. 11,425/- made on account of prior
           period expenses."

                                                                             Page | 1
3.   Briefly, the fact shows that Assessee Company is a promoter company of
     Sahara India life insurance Co Ltd having the main object to promote life
     insurance Company for conduct of the life insurance business.               The
     assessee during the year received from dividend income of INR 1640946/
     and interest income of INR 57064296/.        It filed its return of income on
     31/10/2005 declaring income of Rs. 44104390/. The assessment u/s 143
     (3) of The Income Tax Act was passed on 28/12/2007 by the learned
     assessing officer determining the total income of the assessee at INR 5
     6783515/ by making following additions.
        a. Disallowance u/s 14 A of the income tax act of INR 8 403/
        b. disallowance of loss on sale of securities debited to the profit and loss
           account of INR 1 2435157/
        c. disallowance of expenses claimed under section 35D of INR 2 24140/
        d. disallowance of prior period expenses of Rs. 11425/
4.   Assessee aggrieved with the order of the learned assessing officer preferred
     an appeal before the learned CIT  A. He deleted the disallowance of INR
     8403/ u/s 14 A of the income tax act.          He also directed the learned
     assessing officer treated the loss on sale of securities as business loss in the
     hands of appellant and compute the income accordingly.              He further
     directed the learned assessing officer to delete the disallowance u/s 35D of
     the income tax act of Rs. 224140/. He also deleted the disallowance of Rs.
     11425/ under the head prior period expenses. In short, he allowed the
     appeal of the assessee and therefore the revenue is aggrieved with the order
     of the learned CIT  A and is in appeal before us.
5.   Ground number 1 of the appeal is general in nature and therefore it is
     dismissed.
6.   Ground number 2 is against the disallowance u/s 14 A of the income tax
     act of INR 8 403/ deleted by the learned CIT appeal. The learned assessing
     officer noted that assessee has earned dividend income of INR 1 640946/
     and operational expenses against such income have claimed deduction.
     However no deduction is to be allowed under section 14 A of the income tax
     act in respect of the expenditure incurred by the assessee in relation to the
     income which does not form part of the total income. As per order sheet
     entry dated 4/10/2007 the assessee was asked to show cause as to why the

                                                                              Page | 2
     proportional disallowance of expenses against this dividend income should
     not be made. The assessee submitted that these expenses incurred by the
     assessee are minimum expenses, which are required by a corporate entity to
     retain its status as a corporate entity and should not be disallowed. After
     considering the explanation of the assessee, he proportionately disallowed
     the expenses of INR 8 403/ out of total operational expenses incurred by
     the assessee of INR 3 00608/. On appeal before the learned CIT  A , he
     held that the above disallowance has been made on ad hoc basis since no
     expenditure has been directly pointed out by the learned assessing officer to
     be attributable to earning of dividend income during the year. He further
     held that there should be proximate link between the expenditure to be
     disallowed with the exempted income. Since the entire disallowance is on
     ad hoc basis, without pinpointing any particular expenditure, which can be
     attributable to the earning of dividend income by the assessing officer, he
     deleted the above disallowance.
7.   The learned departmental representative vehemently submitted that as the
     assessee has earned huge dividend income and therefore the disallowance
     u/s 14 A of the income tax act is required to be made which has been made
     by the learned assessing officer on proportionate basis.
8.   The learned authorised representative vehemently submitted that the
     assessee has earned dividend income however; no expenditure has been
     incurred by the assessee for earning of exempt income. He submitted that
     in absence of any satisfaction of the learned assessing officer that assessee
     has incurred any expenditure for the purpose of earning of exempt income
     the disallowance cannot be made.
9.   We have carefully considered the rival contention and perused the orders of
     the lower authorities. In the present case the learned assessing officer has
     failed to record his satisfaction under section 14 A of the income tax act that
     assessee has incurred any expenditure for the purpose of earning of the
     exempt income. It is mandatory for learned assessing officer to    first record
     his satisfaction with reference to the books of accounts of the assessee that
     explanation of the assessee, that
          a. it has not incurred any expenditure for the purpose of earning of
             the exempt income of the income or

                                                                            Page | 3
           b. quantified disallowance by assessee

      under the provisions of section 14 A of the income tax act is incorrect. In
      the present case, we do not find any such satisfaction recorded by the
      learned assessing officer in his assessment order. Further, the assessee has
      shown us    in the paper book that such dividend income received does not
      have any efforts on the side of the assessee; therefore, no such expenses are
      incurred for earning it.   Hence, on this score we do not find any infirmity in
      the order of the learned CIT  A in deleting the disallowance of INR 8 403/
      u/s 14 A of the income tax act. Accordingly, ground number 2 of the appeal
      is dismissed.

10.   Ground number 2 is with respect to the disallowance deleted by the learned
      CIT  A on account of loss on sale of securities of INR 1 2435157/. The
      learned assessing officer noted that assessee has claimed the loss on sale of
      securities of INR 1 2435157/. The assessee was asked to justify its claim.
      The assessee submitted that company is in the nature of investment
      company. Making of investment is the only business of the company. Assets
      held are not in the nature of capital asset but are business assets of the
      company. Therefore, the profit and loss, which arises as to the assessee on
      transfer of such assets, is chargeable to tax only under the head business
      income. The learned assessing officer noted that assessee company is not
      engaged in the business of dealing in shares of securities but the surplus
      fund which were available with the assessee were invested for earning of the
      income such was the claim of the assessee as per his letter dated
      19/11/2007. On consideration of the above explanation of the assessee, he
      held that there is a contradiction in both the above reply of the assessee. In
      the 1st reply the assessee has stated that assessee company is an
      investment company in the nature and making of investment is the only
      business of the assessee company. In the 2nd reply the assessee stated that
      the investment in shares of other company as well as investment in security
      is not the main object of the assessee company. He further perused the
      schedule 3 of the balance sheet for the year ended on 31/3/2005 wherein
      the securities of INR 1 828328401/ has been shown by the assessee as
      investment and not in stock in trade. It further referred to the object of the
      investment in shares stating that it was to earn income by way of a dividend
                                                                              Page | 4
      etc. , hence the losses incurred by the assessee on sale of shares should be
      capital loss and not revenue loss. He further stated that losses, which are
      not deductible from business income, include losses due to sale of security
      held as investment.    He further referred to the circular number 4 of the
      central board of direct taxes which provides that when the assessee
      company has an investment comprising of securities than same are to be
      treated as capital asset and not the trading asset. Therefore, he held that
      the loss on sale of securities is a capital loss and loss on sale of securities
      cannot be debited to the profit and loss account and it is being disallowed.
11.   The assessee aggrieved with the order of the learned assessing officer on
      this ground preferred an appeal before the learned CIT  A who held that
      such losses are business losses of the assessee.
12.   The learned departmental representative on this ground submitted that
      assessee has shown the above as ,,investment and not as ,,stock in trade
      but as capital investment under the schedule of the balance sheet as
      investment and therefore the transfer of such assets or sale of such assets
      would only result into the capital loss or capital gain to the assessee. It
      cannot be held to be the business loss of the assessee.          He therefore
      submitted that the learned CIT  A has erred in holding that such capital
      loss is to be treated as a business loss of the assessee.
13.   The learned authorised representative reiterated the submissions raised
      before the learned CIT  A.
14.   We have carefully considered the rival contention and perused the order of
      the learned lower authorities. The fact shows that the assessee has debited
      loss on sale of securities of INR 1 2435157/ in its profit and loss account
      and claimed it as business loss. The claim of the assessee is that assessee
      company is in the business of investment in making of investment, that is
      the only business of the company. Therefore investemnst hld by the
      assessee   in non life insurance business      held are not in the nature of
      capital asset but are business assets of the assessee company. Therefore
      any profit or loss arising in liquidation of such asset is in the nature of
      business income/loss as has been rightly claimed by the assessee. It was
      further claimed by the assessee that from the conduct of the assessee in the
      earlier years which is of treating the income arising from sale of purchase of






                                                                              Page | 5
securities as business income in assessment year 2004  05,            which is
assessed as such u/s 143 (3) of the act for that year , now the stand of the
assessing officer to treat    it otherwise, when there is a loss on sale of
securities as capital loss is changing the stand in the year in which it is
beneficial to revenue to treat it as business income and when there is a loss
to treat it as capital loss. The learned CIT  A has considered the whole
issue after considering circular number 4/2007 dated 15/6/2007. He held
as under:-
      "Ground no 3 (a) to 3 (c)
      In these grounds of appeal, the appellant has objected to the
      treatment of loss incurred by the appellant on the sale of
      securities and claimed as a business loss to be in the nature of
      a short-term capital loss.
      As per the main object of the appellant company, the company
      was incorporated to promote life insurance Company for
      conduct of life insurance business. In pursuance of its main
      object of the appellant company made investment in Sahara
      India life insurance Co Ltd and promoted the same and also
      purchased shares and securities of other companies from the
      market which were kept by it in its investment portfolio. From
      time to time, the appellant company was trading in securities
      and shares of other companies except for the life insurance
      company, which it had promoted.
      The appellant company has been showing income, which has
      been derived from the trading in the securities et cetera, as well
      as interest under the head business income in the past, which
      has been accepted by the Department all along.         During the
      relevant previous year, there was a loss on sale of securities,
      which was claimed as business loss, and the same was
      disallowed by the assessing officer on the pretext that the
      assessee has given contradictory replies to his queries.
      During the course of assessment proceedings the assessing
      officer raised a quarry to the appellant as to justify the claim of
      loss on sale of securities in respnse to which the appellants

                                                                            Page | 6
responded that the business of the appellant is in the nature of
that of an investment company and making of investment is
the only business carried on by the appellant company and
therefore, the assets held by the appellant are not in the nature
of capital assets but are business assets and company thereof
had shown the profits and/losses as business income.
Thereafter, on further query of the assessing Officer the
appellant replied to the assessing officer that the appellant
company is not engaged in the business of dealing in shares
and securities but the surplus funds, which were available
with it, were invested by it to earn income from shares on
securities.   According to the assessing officer the appellants
reply is in contravention and, therefore referring to the sum
circular number 4 of CBDT he proceeded to treat the loss
claimed by the appellant on the sale of securities to be in the
nature of capital loss and not as business loss and disallowed
the same.
On behalf of the appellant it was vehemently argued that the
assessing officer has misunderstood the reply of the appellant
as the main object of the appellant company was to promote
life insurance company and to invest in purchase of shares,
debentures and stocks of other companies and the appellant
company was, therefore, in the nature of an investment
company. The nature of the activity of the appellant company
is that of investing turnaround, selling and buying of shares
and securities on a regular basis and, therefore the appellant
was entitled to show income as business income and to claim
the loss as business loss.
I have carefully considered the facts and circumstances of the
case and I have also perused the circular referred to by the
assessing officer in which circular, the board has given
directions for distinction between shares held as stock in trade
and shares held as capital asset. In paragraph number 10 of
that circular it is categorically stated that CBDT also wishes to

                                                                    Page | 7
emphasise that it is possible for a taxpayer to have 2 portfolios
i.e. investment portfolio comprising of securities which are to
be treated as capital asset and trading portfolio comprising of
stock in trade which are to be treated as trading assets and the
appellant has 2 portfolios.    The appellant may have income
under both the heads, capital gain as well as business income.
On perusal of the objects of the appellant company, it is
categorically clear that the main object of the appellant
company was to       promote life insurance business         and,
therefore, the investment, which the appellant company has
made in the investment promotion of life insurance business,
can be treated as an investment, which will be subjected to
capital gains.
As regards the other investment although wrong nomenclature
given by the company, the same was in the nature of short-
term investment, which was being regularly, switched over and
traded by the appellant company. The same is in the nature of
short-term investment or stock in trade and therefore, the
business of the appellant company being a keen to that of
investment company, the income/loss arises there from was in
the nature of business income/loss. Further, the action of the
appellant in the preceding years of treating the income as
business income also further strengthens stand of the
appellant that the law is also is in the nature of business loss
or otherwise the appellant would have opted to get the profit on
purchase, sales of securities taxed under the head capital
gains which, in turn, would have also helped it to save tax.
The conduct of the appellant shows that the income arising
from the sale and purchase of securities is in the nature of
business income and sale conduct stands accepted by the
assessing officer in the earlier years, I find no reason to change
the stand during the year under appeal only for the reason that
loss has occurred during the year on sale of securities.



                                                                     Page | 8
            For the above proposition of principles of consistency, I follow
            the decision of the honourable Delhi High Court in case of CIT
            vs Lagan Kala upvan (259 ITR 489 (Delhi).
            As a result, I direct the assessing officer to treat the laws of the
            sale of securities as business loss in the hands of appellant
            and compute the income accordingly."
                                                          [ underline supplied by us ]
15.   It is interesting to note that in assessment year 2004  05 the assessee has
      earned profit on sale of the securities which has been assessed by the
      learned assessing officer u/s 143 (3) of the income tax act as business
      income. However, during the year the learned assessing officer has changed
      his stand when assessee has incurred loss and tried to justify it as short-
      term capital loss incurred by the assessee.         The learned departmental
      representative could not point out any distinction between the transactions
      entered into by the assessee in assessment year 2004  05 and transactions
      entered into by the assessee in assessment year 2005  06. In view of the
      above facts, it is a clear-cut case of the change of opinion by the learned
      assessing officer only to extract the higher tax.      The assessing officer is
      blowing hot and cold on the same set of facts in two different assessment
      years to cough up more taxes from the assessee. This tactic of the learned
      assessing officer deserves to be condemned.         The learned departmental
      representative also could not point out any infirmity in the order of the
      learned CIT  A in he stated that assessee has maintained two portfolios
      whereas the life insurance investment is held to be an investment portfolio
      and other securities are held to be the trading assets. In view of this, we
      dismiss ground number 3 of the appeal of AO.
16.   Now we come to ground number 4 of the appeal wherein the disallowance
      under section 35D in respect of preliminary expenses return of Rs.
      224140/ was made by the learned assessing officer and deleted by the
      learned CIT  A. This issue is squarely covered in favour of the assessee by
      the decision of the honourable Supreme Court in case of Shashun
      chemicals and drugs Ltd 73 taxman.com 293 (Supreme Court). Admittedly
      this is not the 1st year of the claim u/s 35D out of block of 5 years. The
      honourable Supreme Court in para number 13 of the decision has held that

                                                                                   Page | 9
      in any case, it warrants reputation that in the instant case under the very
      same provisions benefit is allowed for the first two assessment years and,
      therefore, it could not have been denied in the subsequent block period.
      The issue before the honourable Supreme Court was also with respect to the
      benefit of section 35D of the act. In view of this, we dismiss ground number
      4 of the appeal of the learned assessing officer.
17.   Ground number 5 of the appeal is with respect to the disallowance of prior
      period expenses of Rs. 11425/ which is deleted by the learned CIT  A.
      The above issue is also squarely covered against the assessee in the decision
      of the Supreme Court in Saurashtra cement and chemical industries Ltd vs
      Commissioner of income tax 213 ITR 523/. In the present case also the
      bills for the expenditure was received in the current financial year relating
      to the earlier financial year and therefore such expenditure has crystallized
      during this year and therefore they are allowable.       After considering the
      argument of the rival parties, we do not find any infirmity in the order of the
      learned CIT  A in deleting the above disallowance.           Therefore, ground
      number 5 is dismissed.
18.   In the result ITA number 2477/del/2011 filed by the learned deputy
      Commissioner of income tax for assessment year 2005  06 is dismissed.
19.   Now we come to the appeal of the assessing officer for assessment year 2007
       08 wherein he has raised the following grounds of           appeal in ITA No.
      981/Del/2011 for the Assessment Year 2007-08:-

      "1.   The order of the ld CIT(A) is not correct in law and facts.
      2.    On the facts and in the circumstances of the case, the ld CIT(A) has
            erred in law and facts in deleting the addition of Rs. 2,24,140/- made
            by AO on the account of preliminary expenses written off during the
            year.
      3.    On the facts and in the circumstances of the case, the ld CIT(A) has
            erred in law and facts in deleting the addition of Rs. 1,01,54,708/-
            made by the AO on the account of interest expenses."


20.   In short the fact shows that assessee is a company, filed its return of
      income at INR 1 33033102/ on 31/10/2007. The assessee company is a
      promoter company of Sahara India life insurance Company for conduct of
      life insurance business. During the year the assessee company has received
      interest of INR 1 22813372/ and income from sale of securities of INR 1
                                                                              Page | 10
      04410014/.      The assessment u/s 143 (3) of the act was passed by the
      learned assessing officer on 23/12/2009 determining total income of the
      assessee at INR 1 33257250/.       During the assessment proceedings the
      addition of INR 1 0378848 was made by the learned assessing officer stating
      as under:-

           "3. Disallowance of expenses claimed u/s 35D and interest
           paid

           The assessee company has claimed deduction u/s 35D of
           income tax act 1961 amounting to INR 2 24140/ and
           interest expenditure of INR 1 0996898/. Out of interest
           expenses of INR 1 0996898/ an amount of INR 8
           42910/ has been added back in the computation as it is
           an interest on income tax. Under the head income from
           profits and gains of business or profession, the expenses
           are expressly allowed u/s 30 to 37 of the income tax act
           1961.     The income of the assessee is the income from
           other sources wherein deductions are to be allowed only
           u/s 57 of the income tax act.      Therefore, the deduction
           claimed u/s 35D amounting to INR 2 24140/ and
           expenses of INR 1 0154708/ (INR 1 0996898/ less INR 8
           42910/) claimed as interest expenses cannot be allowed
           and being added back to the income of the assessee."

21.   The assessee aggrieved with the order of the learned assessing officer
      preferred an appeal before the learned CIT  A. He granted the deduction of
      the claim of the assessee of Rs. 224140/ under section 35D of the income
      tax act.     He further directed the learned assessing officer to delete the
      disallowance of INR 1 0154708/ holding that the income is chargeable to
      tax of the assessee under the head business income and therefore assessee
      is entitled to deduction of interest expenditure claimed by it as same is
      related to the borrowed funds which in turn has been utilized in the
      business of the appellant. He also alternatively held that above expenditure
      is also deductible u/s 57 of the act under the head income from other
      sources. Therefore the revenue is aggrieved with the order of the learned
      CIT  A against the deletion of the addition of Rs. 224140/ and
                                                                           Page | 11
      10154708/ of the interest expenses has preferred this appeal in ITA
      981/del/2011.
22.   Ground number 1 of the appeal is general in nature and therefore it is
      dismissed.
23.   Ground number 2 is identical to ground number 4 in the appeal of the
      learned assessing officer for assessment year 2005  06 wherein we have
      dismissed the above ground following the decision of the honourable
      Supreme Court in 73 taxmann.com 293 (SC ) in case of Shashun chemicals
      and drugs Ltd vs Commissioner Of Income Tax , wherein it has been held
      that where the assessee company was granted deduction under section 35D
      for a period of 10 years and same was granted for initial 2 years, the
      assessing officer could not reject claim for subsequent year stating that
      such expenditure are capital in nature.    As in the present case also the
      deduction allowed to the assessee under section 35D initially has not been
      disturbed, therefore the learned assessing officer cannot now disturbed in
      subsequent years this deduction.     Accordingly, ground number 2 of the
      appeal is dismissed.
24.   Ground number 3 of the appeal is with respect to the disallowance deleted
      by the learned CIT  A on account of interest expenditure of INR 1
      0154708/. The briefly the fact shows that the assessee has earned interest
      on income tax refund of INR 8 42910/ which has been shown by the
      assessee under the head income from other sources however assessee has
      claimed the total interest expenditure of INR 1 0378848/ under the head
      profits and gains of the business and the claimed it as allowable u/s 36 of
      the income tax act. The learned assessing officer noted that income of the
      assessee the income from other sources and therefore the deduction is only
      allowable u/s 57 of the income tax act. Therefore a disallowed the interest
      expenditure. The learned CIT  A deleted the above disallowance holding
      that interest expenditure incurred by the assessee is for the purposes of the
      business and therefore it is allowable u/s 36 of the income tax act.
      Alternatively, he also held that it is also allowable as deduction under
      section 57 of the income tax act.
25.   The learned departmental representative vehemently supported the order of
      the learned assessing officer and stated that as assessee does not have any






                                                                           Page | 12
      business, therefore the interest expenditure claimed by the assessee is not
      allowable to the assessee has deduction u/s 36 of the income tax act. He
      also contested that it is also not allowable to the assessee as deduction u/s
      57 of the income tax act.
26.   The learned authorised representative vehemently supported the order of
      the learned CIT  A.
27.   We have carefully considered the rival contentions and perused the orders of
      the lower authorities. The learned CIT  A has dealt with the whole issue
      along with the deduction claimed by the assessee u/s 35D of the income tax
      act as under:-
            "5.3.2 I have gone through the facts and circumstances of
            the case and argument placed before me by the learned
            counsel for the appellant.    As already held by me in my
            decision against the ground number 2, the income which
            has been on by the appellant should be subjected to tax
            under the head business income as rightly claimed by the
           appellant and consequently the appellant is entitled to
            deduction of interest which has been claimed by him as an
            expenditure, the sum being relatable to the borrowed funds
            which in turn have been utilized in the business of the
            appellant. It is not the case of the assessing officer that the
            funds on which interest is being paid have not been used for
            the business purposes of the appellant and therefore I find
            no justification in disallowing the expenditure of INR 1
            0154708/.
            Alternatively also, if the income is subjected to tax under the
            head income from other sources the appellant is entitled to
            deduction of claim of interest on the funds borrowed which,
            in turn, have augmented the income of the appellant under
            the head income from other sources and therefore the same
            is a direct Nexus with the earning of income and is fully
            allowable u/s 57 of the income tax act.
            In light of the above, I direct the assessing officer to delete
            the addition of INR 1 0154708/."

                                                                              Page | 13
       The learned CIT  A has examined the allowability of expenditure under the
       head ,, profits and gains of business    or profession  as well as under the
       other head of ,,income from other sources , and in both the heads, he held
       that the expenditure is allowable to the assessee. On analysis of the annual
       accounts of the assessee and further when deduction u/s 35D of the income
       tax act under the head profits and gains of the business has been allowed to
       the assessee as per the decision of the honourable Supreme Court, it cannot
       be said that assessee does not have any business, therefore, the interest
       expenditure incurred by the assessee is allowable as deduction under both
       the heads. In AY 2005-06, we have also held that assessee ,,s loss of sales of
       securities is chargeable to tax under the head business income and ld AO
       himself has accepted in AY 2004-05 that profit earned by the assessee on
       sale of securities is business income of the appellant, now it cannot be said
       that assessee does not have any business in this year.            The learned
       departmental representative could not point out any infirmity in the order of
       the learned CIT  A. In view of this, we do not find any infirmity in his order
       and dismiss ground number 3 of the appeal.
28.    In the result ITA number 981/Del/2011 filed by the learned assessing
       officer for the assessment year 2007  08 is dismissed.
       Order pronounced in the open court on 18/07/2019.

            -Sd/-                                               -Sd/-
        (KULDIP SINGH)                                   (PRASHANT MAHARISHI)
       JUDICIAL MEMBER                                  ACCOUNTANT MEMBER

Dated: 18/07/2019
A K Keot

Copy forwarded to

  1.   Applicant
  2.   Respondent
  3.   CIT
  4.   CIT (A)
  5.   DR:ITAT
                                                            ASSISTANT REGISTRAR
                                                              ITAT, New Delhi




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