9911796707
TMI Blog1979 (2) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee had,entered into a contract for forward delivery of shares wanted the contracts to be closed either by payment of difference or by actual delivery of shares. The assessee, therefore, borrowed 300 shares of Morarjee Gokuldas Spinning and Weaving Mills from one Smt. Savitridevi Gopalka and delivered them to the said party. The assessee-firm then purchased 530 shares, out of which 200 shares were returned to the said Savitridevi and the balance of 330 shares were sold in the market. In this transaction, the assessee made a profit of Rs. 38, 101 and after deducting the bank charges of Rs. 41 the net profit came to Rs. 38,060 on the purchase and sale of shares. In the same year, the assessee had incurred a loss of Rs. 39,898 in his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchases and sales of Morarjee Gokuldas Spinning and Mills' shares and he attempted to point out that out of 530 shares, 200 shares were returned to Smt. Savitridevi on March 25, 1963, and the remaining 100 shares, though originally purchased in the name of the assessee, were transferred in the name of Savitridevi but in effect that was intended to share up the loan transaction in which 300 shares were earlier taken on loan by the assessee. Thus, it was sought to be contended before us, that out of the profit from the sale of 330 shares the profit from the transfer of 100 shares in favour of Savitri devi at least should have been treated as profit from a speculative transaction since the transfer of these 100 shares was related to the earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or scrips. Corresponding provision in the I.T. Act, 1922, was Expln. 2 to s. 24, which has been construed by the Supreme Court in Davenport Co. P. Ltd. v. CIT (1975) 100 ITR 715. The Supreme Court has pointed out in that case that a transaction which is otherwise speculative would not be a speculative transaction within the meaning of Expln. 2, if actual delivery of the commodity or the scrips has taken place. In view of the decision in Davenport and Company's case [1975] 100 ITR 715 (SC), the transaction in question in which the assessee has earned profit could not be said to be a speculative transaction as contemplated by s. 43(5) of the I.T. Act, 1961. Consequently, the question referred to us must be answered in the negative and again ..... X X X X Extracts X X X X X X X X Extracts X X X X
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