Section 14a

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

31 December 2012 5
3.1 Mr. A is engaged in the following activities:
i. manufacturing of machine spares in the state of Himachal Pradesh;
ii. trading in shares; and
iii. investment in shares.
includes dividend with trading in shares; and investment in shares.

3.2 With regard to manufacturing business, he has claimed deduction under Section 80IC of the Act till
AY 2009-10.
3.3 He earned the following dividend income from the above activities, which is not chargeable to tax:
Source / Activity Dividend Income
(INR)
Shares held for trading purposes 10 Lacs
Shares held as investments 20 Lacs
3.4 He has also earned Rs 50 Lacs from the share trading activity.

Question -
1)Whether provisions of Section 14A can be applied to share trading activity?
2)In case, Mr. A had made investment in unlisted securities and had not earned any dividend
income as mentioned in Point No. 4, could he have justifiably taken the stand that no
disallowance can be made under Section 14A?

Querist : Anonymous

Querist : Anonymous (Querist)

31 December 2012 Plz gv ans as early as possible with section & related case laws.