2010 (6) TMI 16

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....pendently or cumulatively." 2. Section 94(7) of the Income Tax Act, 1961, as it stood at the material time, reads as follows: "(7) Where (a) any person buys or acquires any securities or unit within a period of three months prior to the record date; (b) such person sells or transfers such securities or unit within a period of three months after such date; (c) the dividend or income on such securities or unit received or receivable by such person is exempt, then, the loss, if any, arising to him on account of such purchase and sale of securities or unit, to the extent such loss does not exceed the amount of dividend or income received or receivable on such securities or unit, shall be ignored for the purposes of computing his ....

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....pelt out in clauses (a), (b) and (c) of Subsection 7, must be fulfilled before the consequence that is envisaged in the section comes into force. In the present case, the sale of the units has taken place after the expiry of a period of three months from the record date. Hence, the second condition spelt out for the applicability of subsection 7 would not come into force. 5. The Memorandum explaining the provisions of the Finance Bill of 2001 by which subsection 7 was inserted, would make it clear that the requirements were intended to be cumulative. The Memorandum inter alia states as follows: "It is proposed to insert a new subsection (7) in the said section to provide that where any person buys or acquires securities or unit within....