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TMI Blog2007 (3) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 and the same were sold on the next date i.e., 10th Oct., 2000 for a consideration of Rs. 2,10,31,305. This resulted in short-term capital loss of Rs. 29,43,695. On account of holding of units for one day, the assessee also earned dividend income of Rs. 28,97,082. The assessee claimed dividend income as exempt under s. 10(33) of the IT Act, 1961 (Act). On the other hand, it declared short-term capital loss of Rs. 29,43,695, which was set off against the business income. The AO was of the view that the loss was nothing but an expenditure incurred to earn the dividend income which was exempt under s. 10(33) of the Act. Accordingly, the same could not be allowed in view of the provisions of s. 14A of the Act. He also opined that the transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r declaration of (sic) trade which was lacking in these transactions as there was no possibility of getting higher price on sale of units after declaration of dividend. No prudent businessman would purchase anything with intention to sell at loss. Accordingly, it is held that purchase and sale of units did not constitute an adventure in the nature of trade. Since essential feature of trade has been found to be lacking, it is not necessary for us to deal with other factors pointed out by the assessee's counsel." The learned senior Departmental Representative has also relied on the recent decision of the Tribunal. dt. 12th Jan., 2007, in the case of Om Prakash Agarwal vs. Jt. CIT (appeal in ITA No. 7895/Mum/2004), wherein it was held that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 34 CTR (Bom) 23 : (1983) 143 ITR 120 (Bom), for the proposition that in case of conflict between the decisions of non-jurisdictional High Courts, then the view favourable to the assessee should be adopted. Proceeding further, it was submitted that the decision of the Hon'ble Punjab Haryana High Court is distinguishable on facts inasmuch as in that case it was found by the Tribunal that the assessee had not made any investment of its own in the purchase of units inasmuch as the investment was financed by Kotak Mahindra Ltd. through whom units were purchased and sold. This fact played a great role in coming to the conclusion that transaction was not genuine. 5. Rival submissions of the parties have been considered carefully. There is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dventure in the nature of trade Such is not the factual position in the present case. Therefore, the facts before the Hon'ble Punjab Haryana High Court were quite different from the facts of the present case and consequently that decision cannot be applied to the present case. On the other hand, the Hon'ble Delhi High Court in the case of Vikram Aditya Associates (P) Ltd. has upheld the claim of the assessee. Even assuming that there is a conflict between the decisions of two High Courts, the view favourable to the assessee has to be taken, as per the settled legal position. Therefore, following the decision of the Special Bench in the case of Wallfort Shares Stock Brokers Ltd. the issue is decided in favour of the assessee. The order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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