9911796707
TMI Blog2015 (1) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... activity - once a company is categorized as the one carrying on speculation business, an act of segregation needs to be undertaken - the entire loss incurred by the company does not disqualify for set off against profits from other activities - It is only such portion of the loss which is incurred in the speculative activity that gets disqualified. The expression is intended only to segregate the losses, which an assessee may incur from the speculative business on the one hand and non-speculative business on the other hand - It cannot be treated as a provision, directing that only such portion of the loss, which occurs on account of the sale or purchase of shares can be taken into account for the purpose of Section 73 - even the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) of Section 143 of the Act. After remand, the appellant filed revised returns, posting the same loss but with certain different calculations. The Assessing Officer passed an order determining the income of the appellant at ₹ 54,49,940/-. An appeal was filed against the order of Assessment before the Commissioner (Appeals). The appeal was dismissed on 21.03.2002. Thereafter, the appellant filed I.T.A.No.565/Hyd/02 before the Hyderabad Bench of the Income Tax Appellate Tribunal. The appeal was dismissed on 28.02.2003. Hence, this further appeal under Section 260-A of the Act. Sri A.V.Krihsna Kaundinya, learned counsel for the appellant submits that there was no basis for the Assessing Officer or the Commissioner or the Tribunal in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... activity would qualify for set off against the other non-speculative income. The Act creates several facilities for deduction mostly in the form of losses from the income earned by that very assessee. It is not uncommon that an assessee who otherwise earns considerable profit would be tempted to post loss, speculative or otherwise, so that the liability to pay income tax on the profits earned is obviated or minimised. In the process, non-existent or speculative activities are also taken up. Obviously to curb such tendencies, the Parliament introduced Section 73 of the Act, which reads: 73. Losses in speculation business:- (1) Any loss, computed in respect of a speculation business carried on by the assessee, shall not be set off except ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctivity. The circumstances, under which a company can be treated as the one carrying on speculation business, are enumerated in the Explanation. In a way, it can be said that any company, which undertakes the activity of purchase or sale of shares of other companies, but not being the one in the category, enlisted within the brackets is liable to be treated as the one carrying on speculation business. It is not the case of the appellant that it falls into any of the categories, mentioned in the bracketed portion of the Explanation. It is also admitted fact that it undertakes the activity of sale and purchase of shares of other companies. That brings within the fold of the Explanation. Once a company is categorized as the one carrying on ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
