https://www.taxtmi.com/caselaws?id=276379 The first proviso to section 24(1) of the Indian Income-tax Act, 1922 can operate as a substantive rule governing computation of business income where its language extends beyond inter-head set-off. Accordingly, the restriction on adjustment of speculative losses may apply even where both loss and profit fall under the business head. Genuine forward contracts entered into in manufacturing or merchanting activities to protect against price fluctuations fall within the hedging exclusion and are not speculative transactions. Where the quantity and nature of contracts demonstrate protection against business risk rather than independent speculation, resulting losses are deductible as business losses. en-us Thu, 05 Apr 1962 00:00:00 +0530 Mon, 12 Nov 2018 14:49:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276379 The first proviso to section 24(1) of the Indian Income-tax Act, 1922 can operate as a substantive rule governing computation of business income where its language extends beyond inter-head set-off. Accordingly, the restriction on adjustment of speculative losses may apply even where both loss and profit fall under the business head. Genuine forward contracts entered into in manufacturing or merchanting activities to protect against price fluctuations fall within the hedging exclusion and are not speculative transactions. Where the quantity and nature of contracts demonstrate protection against business risk rather than independent speculation, resulting losses are deductible as business losses. Case-Laws Income Tax Thu, 05 Apr 1962 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276379