9911796707
TMI Blog2022 (2) TMI 592X X X X Extracts X X X X X X X X Extracts X X X X ..... hing on record to rebut the correctness of cash deposited in the bank account held with HDFC bank, the addition sustained by the learned CIT(Appeals) cannot be confirmed. Therefore, I hereby direct the Assessing Officer to delete the addition. - Decided in favour of assessee. - ITA No. 8108/DEL/2019 - - - Dated:- 11-2-2022 - Shri Kul Bharat, Judicial Member For the Appellant : Sh. Naman Gupta, CA For the Respondent : Sh. Om Prakash, Sr. DR ORDER PER KUL BHARAT, JM: This appeal, by the assessee, is directed against the order of the learned Commissioner of Income-tax (Appeals)-16, New Delhi, dated 25.07.2019, pertaining to the assessment year 2016-17. The assessee has raised following grounds of appeal: 1. That the order of the Ld. CIT(A) is arbitrary, biased, wrong and bad in law and in facts and circumstances of the case. 2. That the Ld. CIT(A) grossly erred in raising fresh and new ground of objection without giving proper notice to the appellant by just mentioning on order sheet entry dated 18.06.2019. 3. Moreover, the Ld. CIT(A) cannot go beyond the matters that arose out of the proceedings before the AO in gross contravention of judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had debited a sum of R. 9,35,983.75 as loss on sale of shares (derivatives). In response to the query, the assessee submitted that he had done share business with M/s Bezel Stock Brokers Pvt. Ltd. in future only and incurred loss, which was set off against business income of ₹ 12,40,535/-. It was stated before the Assessing Officer that speculative transaction has been defined u/s 43(5)(d) of the Act, according to which, loss in derivative trading was not a speculative loss. However, the Assessing Officer did not accept the contention and made addition of ₹ 9,35,983/-. 3. Further, the Assessing Officer noticed that as per broker s statement, the assessee had made investment of ₹ 18,99,028/- on 14.5.2015, which was peak purchase investment during the year. It was recorded by the Assessing Officer that since the source of investment was not explained by the assessee and same was added back to the income of the assessee, thus the Assessing officer computed income at ₹ 30,85,561/- against the declared income of ₹ 2,50,370/-. 4. Aggrieved against it the assessee preferred appeal before the learned CIT(Appeals). The learned CIT(Appeals) in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oreover, not even a single error/objection has been pointed out in the cash flow chart submitted by the appellant. This means that this cash flow chart was absolutely correct and duly accepted by the CIT(A). It means that the source of cash deposit of ₹ 800,000/- was duly accepted by the Ld. CIT(A). 4) That the Ld. CIT(A) further erred in making wrong interpretation of Cash Flow Chart filed by the appellant. The Ld. CIT(A) has taken into consideration only opening and closing balances of cash flow chart. She has stated that the appellant used cash in hand amounting to ₹ 190,907/- i.e. the difference between the opening balance of ₹ 216,113/- and closing balance of ₹ 25,216/-, ignoring all the receipts and payments of cash flow chart. It is obviously wrong and baseless and source of ₹ 800,000/- is fully explained. Ground No.-5 That the Ld. CIT(A) further erred in not confronting any objections/disagreement with the appellant s explanations. In fact, no objections/dis- agreements are on record and the appeal order has been passed solely on her surmises and conjectures. 7. On the other hand, learned Sr. DR opposed the submissions and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. This is different from regular trading or delivery- based trading where a trade gets settled over a span of days if not longer. So, you get delivery of the shares you bought whiie the shares you sold move out of your demat account . It is also pertinent to examine the concept of margin trading which allows the trader to buy financial instruments on a margin without paying for the entire purchase. Purchase and sale are then squared off at the end of the day with a net purchase or loss that is adjusted against the margin money in the margin account of the trader with the broker. This is what has happened in this case. The appellant on 14.05.2015 has purchased F Os without paying for the purchase and then sold them on the same day at a net profit. This purchase has been made against the margin money deposited by the appellant with the broker. In fact, the AR of the appellant drew my attention to the bank account of the appellant which shows a payment of ₹ 9,75,000/- made to the broker on various dates, during the year under consideration on various dates. A scanned copy of bank account is reproduced as under: It is, however, noted that ail the debit entries of ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
