The Tribunal allowed the assesee’s appeal against the CIT(A)’s order, wherein the order confirmed the disallowance made under rule 8D(2)(iii) with respect to indirect expenditure at the rate of 0. 5% of the average value of investment where the assessee had made a suomoto disallowance of Rs.99,218/- u/s 14A. The Tribunal held that the provisions of section 14A r. w. r. 8D were introduced to discourage the assessees from claiming double deductions i.e. claiming expenditure against exempt income, but, the first step is incurring of expenses. Noting that the AO had neither given any details of expenses incurred by the assessee for earning exempt income nor any reason as to why the calculation made by the assessee was not acceptable, it held that no automatic disallowance could be made u/s 14A. Further, with respect to the assessee’s claim about stock-in-trade, relying on the decision in the case of CIT v. India Advantage Securities Ltd. (2016)380 ITR 471 (Bom) (HC), it held that the assessee was offering income from business of share trading so all the expenses related to the business had to be allowed. (AY. 2009-10)