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TMI Blog1998 (4) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the Ld. CIT(A)-II, New Delhi has erred in accepting the plea of the assessee that the trading in the purchase and sale of shares of other companies is not a speculative transaction and as such the loss of Rs. 2,10,650 arising from these transactions as liable to be set off against business income. The Ld. CIT(A) has overlooked the deeming provisions of explanation to section 73 of the I.T. Act, 1961." 2. The Ld. D.R. has pointed out that the assessee purchased shares of three companies namely M/s. Oswal Agro Mills, M/s H.M.M. Ltd. and M/s Reliance Industries Ltd. on 6-12-1987, 10-12-1987 and 19-12-1987 and the same have been sold on 11-12-1987, 19-12-1987 and 19-12-1987 respectively without making any payment for receiving or selling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Sidhivinayak Chemicals (P.) Ltd. v. Asstt. CIT [1995] 52 ITD 226. Even otherwise it was argued that the business of the assessee company was sale and purchase of shares and in any case even if the said transactions are treated as speculative transactions by applying the explanation to section 73 of the Act then the rest of the business which the assessee company has carried out during the relevant year should also be treated as speculative and the loss of Rs. 2,10,650 may be allowed to be set off against the income from rest of the business carried out by the assessee. For this reliance has been placed in the case of Samba Trading & Investment Ltd. v. Asstt. CIT [1996] 58 ITD 360 (Mum.). It has also been pointed out by the AR that the sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue, a transaction can be treated as speculative transaction where the delivery of shares has not been taken by the assessee. It is not the case of the revenue that the assessee has not been in a position to give the name and addresses of the sellers and purchasers but the whole case of the revenue is that the assessee could not prove before the Assessing Officer that it has taken the delivery of the shares. It is not disputed that Shri M.K. Singhal the stock broker was present before the Assessing Officer and his statement was recorded under section 131 of the I.T. Act, 1961. The said Shri M.K Singhal in his statement before the Assessing Officer has relied to the question as under: "Delivery of shares was taken by me and handed over to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all the three transactions were handled on different dates for the purpose of making delivery. The purchases are alleged to have been made on6-12-1987,10-12-1987and11-12-1987and the sales are stated to have been transacted on11-12-1987,19-12-1987and19-12-1987. In a situation when the delivery of all the shares in question is stated to have been handed over for one day and on the contrary it is found that the date of last purchase and first sale are the same, then it does not inspire confidence as to whether the delivery could be handed over for one day. Also the assessee has not brought any material to show the dates on which it has received the delivery or that it has been received on different dates. A peculiar statement has been made by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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