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TMI Blog2011 (12) TMI 411X X X X Extracts X X X X X X X X Extracts X X X X ..... satisfied - Appeal is dismissed - IT Appeal No. 88 of 2009 - - - Dated:- 15-12-2011 - Shantanu Kemkar and Prakash Shrivastava, JJ. R.L. Jain and Ms. Veena Mandlik for the Appellant. ORDER 1. This appeal under Section 260-A of the Income Tax Act, 1961 has been filed by the department against the order dated 15.5.2009 passed by the ITAT in ITA No.323/Ind/ 2007 for the assessment year 2004-05. 2. In brief, the assessee is engaged in the business of trading in shares and securities, mutual fund units and derivative trading. In addition to this the respondent assessee has salary income as also house property income. The assessee had claimed before the Assessing Officer that for certain transactions done by the assessee, as re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... within a period of three months after such date; ( c ) the dividend or income on such securities or unit received or receivable by such person is exempt. then, the loss, if any, arising to him on account of such purchase and sale of securities or unit, to the extent such loss does not exceed the amount of dividend or income received or receivable on such securities or unit, shall be ignored for the purpose of computing his income chargeable to tax." 6. The CIT (Appeal) has taken the view that the three conditions of Section 94(7) of the Act are to be cumulatively satisfied for attracting the said provision by observing thus :- "4.3 Now to decide the first and main controversy involved, it will be necessary to appreciate the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of ITO v. Shambhu Mercantile Ltd. [2008] 116 TTJ 784/115 ITD 337 and the judgment of the Bombay High Court in the case of CIT v. Walfort Share Stock Brokers (P) Ltd. ; 219 CTR (Bom.) 409, found that the three conditions of Section 94(7) of the Act is to be cumulatively satisfied for attracting the said provision by observing thus :- "20. Considering the facts of the case in the light of the order of Tribunal in the case of Shambhu Mercantile Ltd. ( supra ) and Board circular, it is clear that all the three conditions mentioned in clauses (a) (b) (c) must be cumulatively satisfied for invoking provisions of sec. 94(7) of the IT Act. The ld. DR cited several decisions in support of the contention that Income Tax Act being ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the case of the assessee, the AO has not brought any evidence on record any motive of the assessee in indulging the transactions to earn loss. The AO has merely followed the directions u/s 144A of the IT Act. Ld. Counsel for assessee has demonstrated that assessee is duly qualified and was dealing the business of shares and units. The AO has not brought any material on record that the transaction between mutual fund and the assessee was against the ordinary course of the business of assessee. The AO without bringing any material on record followed the directions of the Addl. CIT and rejected the claim of the assessee. Considering the facts and circumstances above, we are of the view that issue is squarely covered in favour of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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