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TMI Blog2013 (4) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... lls which were produced during the assessment proceedings. The shares were sold first with the intention to purchase the same when its prices fell down but since the price of shares increased, the assessee had to purchase the shares to minimize the loss. In view of these facts, the CIT (A) has held the loss of Rs.31,39,183/- to be a speculation loss and not a contrived loss. These facts have not been controverted by Revenue by bringing any material on record - no reason to interfere with the order of CIT (A) - against revenue. Addition on Profit on sale of shares of TV Today - CIT(A) deleted the addition - Held that:- CIT (A) has given a finding that the purchase of 8200 shares of TV Today was accounted in the individual account of Ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal raised by the Revenue reads as under:- "1. The Ld. CIT (A) has erred in law and on facts in considering the purchase and sale transaction of shares of Divis Lab as contrived loss and also directed to treated as speculation loss. 2. The Ld. CIT(A) has erred in law addition on facts in deleting the addition of Rs.1,65,471/- on account of profit on transactions of 8200 shares of TV today not recorded in the books of account." 4. Cross Objection raised by the assessee reads as under:- "1. In the context of assessee's claim for loss of Rs.31,39,183 in the trading of equity shares of Divis Lab., the CIT (A) should have also held specifically that in the light of ITAT subsequent decision dated 31-7-2009 in assessee's own case for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on and the assessee had just booked loss. He accordingly disallowed the loss of Rs.31,39,183/- which was treated by him as a contrived loss. Aggrieved by the action of A.O., assessee carried the matter before CIT (A). CIT (A) after considering the submissions of assessee and the remand report received from A.O., deleted the addition made by the A.O. but however treated the same as speculation loss by holding as under:- "7. In the present case I find that the A.O. completely mis-directed himself and considered loss of Rs.31,39,183/- in the transaction of 10,500 shares of Divis Lab as contrived loss and added to the total income. In the process, the A.O. failed to consider that during the year under consideration, the appellant has transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Y. 2003-04 by the CIT (A)-III, Ahmedabad vide appellate order dated 30-3-2007. The aforementioned order of the Ld. CIT(A)-III, Ahmedabad has been further confirmed by the Hon'ble ITAT, Ahmedabad (Bench-B) in ITA No.2521/Ahd/2007 order dated 31-7-2009. 9. In view of above, the A.O. is directed to consider the purchase and sale transaction of shares of Divis Lab as normal business transaction and not as contrived loss. However, since there was no consequential delivery effected, the loss of Rs.31,39,183/- from the aforesaid transaction is directed to be treated as speculation loss. This ground of appeal is partly allowed." 6. Aggrieved by the order of CIT (A), the Revenue now in appeal before us and the assessee is aggrieved by the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The transactions of sales were entered before the corresponding purchase transactions and without any existing stock being available with assessee. In the process of sale and purchase of shares the assessee is reported to have incurred net loss. The transactions of purchase and sale were off market transactions and not routed through the stock exchange. CIT (A) has observed that the activity of first selling and then purchasing the shares to be a permissible and normal business activity in share transactions, further the purchase and sell of shares were evidenced by purchase and sales bills which were produced during the assessment proceedings. The shares were sold first with the intention to purchase the same when its prices fell down b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter before CIT (A). CIT (A) after considering the submissions of the assessee deleted the addition by holding as under:- "12. I have considered the submissions of the appellant. I find that Shri Hasmukh N.Vora (Indl.) has purchased 8,200 shares of TV Today on 19-01-2004 and same has been duly accounted in the accounts of Hasmukh N. Vora (Indl.). The appellant has also furnished copy of account of Shri Hasmukh N. Vora (Indl.) from the books of broker H. Nyalchand Financial Services Ltd. The payment has also been made from the account of Shri Hasmukh N.Vora (Indl.). This fact is also reflected in the return of income of Shri Hasmukh N.Vora (Indl.) for A.Y. 2004-05. As such, there is no case of any addition of Rs.1,65,471/- on this score and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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