COMMISSIONER OF INCOME TAX Vs. AREEZ P KHAMBHATTA

JUDGEMENT

(1.) BEING aggrieved and dissatisfied with the impugned order dated 17.11.2005 passed by the Income Tax Appellate Tribunal, Ahmedabad 'B' Bench (hereinafter referred to as 'the Tribunal') in Income Tax Appeal No. 1597/Ahd/2005 for the assessment year 2001 -02, the revenue has preferred the present tax appeal.

(2.) THIS appeal was admitted by this Court on 28.11.2006 for consideration of the following substantial question of law:

(3.) THE assessee company is engaged in the business of manufacturing and selling of soft drink concentrate. The assessee company had filed return of income showing total loss at Rs. 82992622/ -. During the assessment proceedings the Assessment Officer disallowed the expenditure by way of short term capital loss incurred to earn tax free dividend. Being aggrieved by the same, the assessee preferred appeal before CIT(Appeals) and the said appeal came to be allowed whereby CIT(A) held that the short term capital loss cannot be disallowed in terms of the provisions of section 14A of the Act. The revenue thereafter preferred appeal before the Tribunal and the Tribunal after hearing the parties, dismissed the same. Being aggrieved by the same, the present appeal is preferred.