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TMI Blog2018 (5) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... the business income and the remaining loss should be set off against the LTCG. Assessee’s appeal is partly allowed. - ITA No.330/Kol/2017 - - - Dated:- 3-5-2018 - Shri Waseem Ahmed, Accountant Member And Shri S.S.Viswanethra Ravi, Judicial Member For The Appellant : Shri D.K. Sen, Advocate For The Respondent : Shri Soumyajit Dasgupt, Addl. CIT-DR ORDER PER Waseem Ahmed, Accountant Member:- This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), Durgapur dated 28.11.2016. Assessment was framed by DCIT, Circle- Bankura u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 25.03.2013 for assessment year 2010-11. The groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red in confirming the order of Assessing Officer by adjusting the unabsorbed business loss of ₹16,64,524/- against the capital income. 4. Briefly stated facts are that assessee in the present case is a private limited company and engaged in the business of civil construction and broker activities. The assessee during the year has fled its return of income inter alia disclosing the following items of income / loss:- Sl. No. Particulars Amount (Rs) 1. Business income 13,36,761/- 2. LTCG 86,30,598/- 3 . Unabsorbed brought forwa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) pertains to the penalty proceedings therefore no reference to the present case can be made. He vehemently relied on the order of Authorities Below. 7. We have heard the rival contentions and perused the material available on record. In the instant case the assessee has shown business income of ₹13,36,761/- and LTCG income of ₹86,30,498/- only. Besides the above assessee has shown unabsorbed brought forward business loss of ₹16,64,542/- which was set off against the business income to the extent of ₹13,36,761/- by the assessee. The assessee has offered the tax on LTCG at special rate @ of ₹ 20% for ₹ 17,26,100.00 (20% of ₹ 86,30,498.00 only) which transpires that the assessee has not set off th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income under any other head, the whole loss shall, subject to the other provisions of this Chapter, be carried forward to the following assessment year, and- ( i) it shall be set off against the profits and gains, if any, of any business or profession carried on by him and assessable for that assessment year ; 41[* * *] ( ii) if the loss cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following assessment year and so on :] 42[ Provided that where the whole or any part of such loss is sustained in any such business as is referred to in section 33B which is discontinued in the circumstances specified in that section, and, thereafter, at any time before the expiry of the peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration. There is no dispute that assessee has shown business income of ₹13,36,761/- for the year under consideration. Therefore, in our considered view, assessee is very much entitled to claim the set off of the brought forward unabsorbed business loss against the income declared under the head business . The amount which has not been set off against the business income of the assessee can be set off against the LTCG income of the assessee in view of the order of Hon ble Mumbai Tribunal in the case of Digital Electronics Ltd.(supra) wherein it was held as under : Section 72 provides that where for any assessment year, the net result of the computation under the head 'Profits and gains of business or profe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income from business and profession, the loss carried forward can be set off against such profits of the assessee. In that view of the matter, the objection raised by the authorities below are devoid of any legal substance. Therefore, the income earned in the relevant year, although not taxable as 'profits and gains from business or profession' was an income in the nature of income of busiess nevertheless. The assessee was, therefore, indeed justified in claiming set off of business losses against the income of capital gains. It is undisputed fact that the assessee has the earned the long term capital income by way of transfer of the business assets such as factory building, Plant Machinery, electric installation under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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