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TMI Blog2014 (2) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... imed on account of trading in derivative transactions, without appreciating the fact that the loss claimed on the basis of value of derivative as on 31st March is merely a notional loss and the actual loss or the profit in respect of such derivative transactions would get crystallized only at the time of settlement of such transaction". 2. At the outset, the ld. A.R. has submitted that the issue is squarely covered in favour of the assessee by the judgment of the co-ordinate bench of the Tribunal (incidentally constituted by both of us) in the case of M/s. Indsec Securities & Finance Ltd. in ITA No.4236/M/2012 vide order dated 06.09.13. While dealing with the identical issue, the following observations were made by the bench: "8. Ground N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce margin, if any, is received/paid to the broker and finally on the stipulated date the contracts are squared off resulting into actual loss or profit. The contracts in such type of cases can be squared off before the arrival of actual performance date of contract, as the profit and loss are calculated on daily basis and the margins are settled accordingly. Such type of contracts are not purely contingent in nature rather loss or profit is somewhat ascertainable in view of constant watch on daily market value and even the quantum of profit or loss though not actually ascertainable, can be anticipated in view of the trends of the market. The difference between the predetermined price and market price is settled daily on mark-to-market basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be computed in accordance with ordinary principles of commercial accounting, unless, such principles stand superseded or modified by legislative enactments. Unrealized profits in the shape of appreciated value of goods remaining unsold at the end of the accounting year and carried over to the following year's account in a continuing business are not brought to the charge as a matter of practice, though, as stated above, loss due to fall in the price below cost is allowed even though such loss has not been realized actually. Accounts regularly maintained in the course of business are to be taken as correct unless there are strong and sufficient reasons to indicate that they are unreliable. The co-ordinate bench of this Tribunal further re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On the facts and in the circumstances of the case and in law the Ld.CIT(A) has erred in holding that interest of Rs.5,86,887/- received on FDRs given as security to Electricity Board be considered for the purpose of allowing deduction u/s.80IB without appreciating the fact that the said interest income is not directly flowing from the Industrial Undertaking as such deduction for the same is not allowable in view of the Hon'ble Supreme Court in the case of Pandian Chemicals Ltd. (262 ITR 178)(SC) (2003)". 4. At the outset, the ld. D.R. has contended that the issue is squarely covered against the assessee and in favour of the Revenue by the judgment of the Hon'ble Supreme Court in the case of Pandian Chemicals Ltd. (2003) 262 ITR 278) (SC) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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