9911796707
TMI Blog1991 (1) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... of sugar effected through brokers on ex-factory delivery basis. The ITO and the IAC, however, noted that the transactions of purchases and sales were effected on one and the same day and after passing the relevant entries regarding the purchases and sales the resultant loss had been recorded in the books. They, therefore, held the view that the contracts were settled otherwise than by actual delivery or transfer of the commodity and, hence, the transactions were speculative in nature. The ITO accordingly refused to allow the loss in question to be set off against other income of the assessee. In appeal the CIT(A) agreed with the ITO's findings and conclusions and upheld his order. 3. Mr. K.H. Kaji, the learned Advocate appearing for the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the term" speculative transaction" as meaning a transaction in which a contract for the purchase of any commodity, including stock and shares, is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity or scrip. The use of the adjective 'actual' qualifying the nouns "delivery" or "transfer" in the language of s. 43(5) clearly indicates the intention of legislature that physical movement of the commodity from the possession of the seller to that of the purchaser should take place in order to constitute actual delivery or transfer of the commodity. Property in the goods may remain with the seller while the property in the goods may pass to the purchaser with the transfer of documents of title to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ession, through a tenant or agent. 7. To sum up, we are of the opinion that the phrase "actual delivery or transfer of the commodity" used in the language of s. 43(5) no doubt embraces the concept of 'constructive' delivery or transfer of the commodity within its fold but, as stated above, by the above phrase the physical movement of the commodity from the possession of the seller to that of the purchaser has clearly been intended by the legislature. Therefore, to take a transaction of purchase or sale of a commodity out of the net of 'speculative transaction', as defined in s. 43(5), actual delivery or transfer of the commodity direct or constructive shall have to be proved in the context of periodical or ultimate settlement of the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 037 Date of Date of Name of . . Sauda Bill/No Seller/Town Bags Rate Amount 11.8.81 27.8.81 Tala Tal. Sah. Khand . . . . 876 Udyog Mandli 50 648.51 32,425.50 . . Ltd./Talala .. . . 24.8.81 31.8.81 Tala Tal. Sah.Khand .. . . 1122 Udyog Mandli 50 495.00 24,750.00 . . Ltd./ Talala . . . 21.8.81 31.8.81 Billeshwar Khand . . . . 4560 Udyog Sah. Mandli . . . . . Ltd./Khodinar 50 600.00 30,000.00 5.9.81 12.9.81 Billeshwar Khand . . . . 4700 Udyog Sah. Mandli . . . . . Ltd./Khodinar 50 510.00 25,500.00 24.9.81 8.10.81 Talala Tal. Sah. . . . . 1489 Khand Udyog . . . . . Mandli Ltd./Talala 50 525.00 26,250.00 6.10.81 12.10.81 Talala Tal. Sah. . . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ags of sugar on each date from the assessee, copy of bill dt. 31st Aug., 1981 issued by the assessee to the said M/s Amratlal Shamjibhai for sale of 50 bags, and two bills, issued to the assessee by the said sugar factories, asking the payments of the bills. The purchies issued by the Dalal contain a direction to the person placing order for purchase of the required quantity of sugar from the sugar factory through them to send the. 11. It may be seen that it is assessee's own case that it did not take delivery of any of the quantities of sugar bags contracted to be purchased through the Dalal from the two sugar factories. It is also the undisputed position that as many sugar bags as had been contracted to be purchased on a particular date ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
