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TMI Blog2015 (2) TMI 807X X X X Extracts X X X X X X X X Extracts X X X X ..... rising out of such an asset and covered by the said clause would likewise be not includable in computation of the income of the assessee for the year under consideration. The contention of the learned counsel for the assessee that for the purpose of section 10(38) of the Act the term "income" would not include "loss", cannot be accepted and rightly rejected by the Tribunal. If this is the conclusion, it can immediately be seen that any loss in respect of any such capital asset would not be available for set off. The Tribunal rightly relied on the decision in the case of Harprasad (1975 (2) TMI 2 - SUPREME Court) to come to a conclusion that the term "income" under section 10(38) of the Act would also include the loss. In the said decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng-term capital loss of ₹ 1,44,73,463 against the long-term capital gain of ₹ 1,03,00,809 for the same assessment year ? B. Whether, on the facts and in the circumstances of the case, the appellant's claim with regard to set off and carried forward of long- term capital loss of ₹ 1,44,73,463 can be disallowed on the basis of the decisions of the hon'ble apex court in the case of CIT v. Har prasad and Co. P. Ltd. [1975] 99 ITR 118 (SC) and the Madras High Court in the case of CIT v. S. S. Thiagarajan [1981] 129 ITR 115 (Mad), especially when neither the facts nor the provisions of law discussed in the said decisions are comparable to the facts of the appellant's case and the provisions of law a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 1.03 crores. The Assessing Officer disputed such claim and after hearing the assessee disallowed the same holding that the loss from exempt source can neither be allowed as set off nor can be allowed to be carried forward and absorbed against income in subsequent years from the taxable source. 3. The issue ultimately reached the Tribunal. The Tribunal by the impugned judgment ruled in favour of the Revenue and against the assessee, basing reliance on the provisions contained in section 10(38) of the Act and also referring to various other provisions including section 70(3) of the Act. The Tribunal relied on the decision of the apex court in the case of CIT v. Harprasad and Co. P. Ltd. reported in [1975] 99 ITR 118 (SC). 4. The asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of Suashish Diamond Ltd. Perhaps section 74 of the Act may have otherwise also no applicability because it refers to carry forward of the capital loss set off against capital gain of the subsequent year, which is not the case in the present case. Section 70 of the Act refers to income from any other source under the said head of Income . Sub-section (3) thereof which is relevant for our perspective reads as under : 70. (3) Where the result of the computation made for any assess ment year under sections 48 to 55 in respect of any capital asset (other than a short-term capital asset) is a loss, the assessee shall be entitled to have the amount of such loss set off against the income, if any, as arrived at under a simila ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the book profit and Income-tax payable under section 115JB. 7. The fact that the capital asset in question, namely, the shares of Suashish Diamond Ltd. was covered under section 10(38) of the Act was not in dispute. That being the position, by virtue of section 10(38) of the Act, in computing the total income of the previous year, any income covered under such clause shall not be included. If that be so, the loss also arising out of such an asset and covered by the said clause would likewise be not includable in computation of the income of the assessee for the year under consideration. The contention of the learned counsel for the assessee that for the purpose of section 10(38) of the Act the term income would not include loss , ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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