2012 (5) TMI 55

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... short term capital gain of Rs.40,25,93,717/- from off market transactions in shares on which no Securities Transaction Tax (STT) was required to be paid. Such short term capital gain was liable for tax @ 30% under section 115AD. However, in view of proviso to section 115AD short term capital gain arising from share transactions, through stock exchange on which STT was payable is liable for tax @ 10%. The assessee incurred short term capital loss of Rs.12,64,51,006/- from transaction, on which STT was payable. The assessee had also incurred loss of Rs.17,55,335/- from non STT transactions. The assessee had set off short term capital loss against short term capital gain and tax was paid on net short term capital gain. The AO referred to prov....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... option in a particular way vis a vis lower benefit resulting in other way then higher benefit available as per law should not be denied to the assessee. CIT(A) was satisfied by the explanation given. It was observed by him that as held by the Tribunal in the case of First State Investments (Hong Kong) Ltd. vs. ADIT(supra), the matter of computation of income is a subject which comes anterior to the application of rate of tax. The provisions relating to application of rate of tax as contained in Section 111A to 115AD comes into force only after computation of income. CIT(A) also referred to the decision of the Tribunal in the case of Fidelity Investment Trust Fidelity Overseas Fund vs. ADIT (Intl. Taxn.) in which the Tribunal placing relian....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....milar computation made. The AO held that since gain was from shares on which no STT was paid and loss from STT paid transactions, these fell in different categories and could not be set off against each other. We find that this aspect has already been examined by the Mumbai bench of the Tribunal in the case of First State Investments (Hong Kong) Ltd. vs. ADIT(supra), in which it has been held that the phrase "under similar computation made" refers to computation of income, the provisions for which are contained under sections 45 to 55A of the Act. The Tribunal also held that the matter of computation of income was a subject which came anterior to the application of rate of tax which are contained in section 110 to 115BBC. Therefore, merely ....