2010 (8) TMI 1009 - AT - Income Tax

Summary

Issues Involved:
The appeal is time-barred by 17 days. The main issue is the condonation of the delay in filing the second appeal due to illness of the tax consultant. Another issue is the disallowance of set-off of brought forward speculation loss against speculation profits u/s.73(4) of the Income Tax Act, 1961.

Condonation of Delay:
The delay of 17 days in filing the second appeal was attributed to the illness of the tax consultant, as explained by the appellant. The appellant relied on various decisions, including the case of Collector, Land Acquisition vs. Mst. Katiji, emphasizing a liberal view in condoning delays. The Tribunal found the reasons for the delay to be sufficient cause and thus condoned the delay.

Disallowance of Set-off of Speculation Loss:
The Assessing Officer disallowed the set-off of speculation loss from previous years against current year profits, citing sec.73(4) of the Act which limits carry-forward to four years. The ld. CIT(A) upheld this decision based on the judgment in Reliance Jute & Industries Ltd. vs. CIT. However, the appellant contended that a Tribunal order directed the allowance of such set-off in a similar case, making the Assessing Officer's decision untenable.

Tribunal's Decision on Set-off:
The Tribunal analyzed the provisions of sec.73(4) and noted that it pertains to carrying forward losses to subsequent years, not setting off losses from earlier years. Referring to previous judgments, including Shah Sadiq & Sons, the Tribunal held that the appellant was entitled to set off speculation losses from Assessment Years 2000-01 and 2001-02 against the profits for Assessment Year 2006-07. The Assessing Officer was directed to allow the claim in full.

Levy of Interest:
The appellant challenged the levy of interest u/s. 234B and 234C, which was considered consequential and not objected to by the ld. DR. The Tribunal directed the Assessing Officer to allow consequential relief, resulting in the ground taken by the appellant being allowed.

In conclusion, the Tribunal allowed the appeal, condoned the delay in filing the second appeal, directed the set-off of speculation losses against profits, and granted relief regarding the levy of interest.