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TMI Blog2016 (5) TMI 219X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purposes of section 73 (1) of the act. It is an admitted fact that the assessee is having income from interest, dividend income and income from capital gains from sale of long-term investment. Applying the law to the facts of the present case before us, the assessee’s case falls within the purview of exception carved out in the explanation to section 73 of the act and consequently the assessee shall not be deemed to be carrying on with the speculative business for the purposes of section 73 (1) of the act. - Decided in favour of assessee - I.T.A. No. 4993/Del/2014 - - - Dated:- 29-4-2016 - Shri N. K. Saini, Accountant Member And Smt. Beena Pillai, Judicial Member For the Appellant : Shri Ved Jain, CA For the Respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law in ignoring the fact that out of the total loss of ₹ 35,76,559/- a sum of ₹ 11,05,708/- is a loss in derivative transactions which is not considered to be speculative loss in view of the proviso (d) to section 43(5) of the Act as inserted by the Finance Act, 2005. 5. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in ignoring the fact that a sum of ₹ 3,07,906/- out of the total loss of ₹ 35,76,559/- is on account of the valuation of the shares as on the closing date of the year. 6(i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the disallowance of ₹ 34,872/- under section 14A of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of explanation to section 73 (1) of the act and accordingly disallowed the loss of Rs.(-)85,76,559.04 claimed by the assessee treating the same as speculation business. The ld.AO also made addition under section 14 A of the act. 3. Aggrieved by the order of the Ld. AO assessee preferred an appeal before the Ld.CIT (A). 4. The ld. CIT(A) confirmed the additions were made by the Ld. Assessing Officer 5. Aggrieved by the order of the ld.CIT(A), assessee is an appeal before us now. 5.1 At the outset the Ld. A.R. submitted that ground No. 6 raised in the appeal for the year under consideration is not pressed, considering the smallness of the amount involved. Accordingly we are not inclined to adjudicate upon the issues of section 14A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved that the assessee has calculated the total revenue as per the profit and loss account in the following manner: Particulars Amount (Rs.) Income from sale/purchase of shares (-) 35,76,559.04 Dividend ₹ 55,955/- Interest ₹ 21,484/- Profit on sale of long-term investments ₹ 71,60,836.68 72,38,275.68 6.2 The authorities below has invoked explanation to section 73 to the facts of the present case and disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng income from interest, dividend income and income from capital gains from sale of long-term investment. Applying the law to the facts of the present case before us, the assessee s case falls within the purview of exception carved out in the explanation to section 73 of the act and consequently the assessee shall not be deemed to be carrying on with the speculative business for the purposes of section 73 (1) of the act. This view has been supported by the various judgments relied upon by the assessee which are as under; 1. CIT City 4 vs. HSBC securities and capital markets India (P) Ltd (2012) 23 Taxmann.com 377 (Bom.) 2. A.K Capital Markets Ltd. Vs. DCIT, Central Circle-2 (2016) 65 Taxman.com 62 (Delhi-TRIB.) 6. In view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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