2015 (10) TMI 1879

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.... by ld. DR, Shri A. Ramachandran, is broadly in support of the assessment order by advancing arguments which is identical to the ground raised. On the other hand, the ld. counsel for the assessee, Shri Biharilal defended the conclusion arrived at in the impugned order. 2.1. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee is a share broker and trader in shares/investor. During the year under consideration, the assessee received brokerage of Rs. 26,61,904/- and also loss on account of trading in shares amounting to Rs. 1,72,33,233/-, which was treated as deemed speculation. The assessee carried forward the loss on account of alleged speculative income and Rs.....

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....me Tax (Appeals) was that application of explanation to section 73 of the Act is quite unjustified as the provision is not applicable, where income on sale of shares held as investment offered under the head capital gain/capital loss by further claiming that section 73 is applicable in respect of loss in speculation business. The ld. Commissioner of Income Tax (Appeals) granted relief to the assessee. 2.3. The Revenue is aggrieved and is in appeal before this Tribunal. We find that the assessee is admittedly engaged in the business of trading of shares as investment. The assessee earned loss of Rs. 1,72,33,233/-. The question for consideration is whether the long term capital gain/short term capital loss of the assessee are in the nature....

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....of any speculation business carried on by him assessable for that assessment year and (ii) If the loss cannot be wholly set off, the amount of loss not so set off shall be carried forward to the following assessment year and so on. Thus, we find no infirmity in the conclusion of the ld. Commissioner of Income Tax (Appeals) because there is no positive income available for taxation for the current year and even if, these are held to be speculative transactions, the loss was required to be set off against the profit during the year itself as per sub-section 1 to section 73. However, we are in agreement with the finding of the ld. Commissioner of Income Tax (Appeals) that the LTCG and STCG were not speculative transactions. 3. Next gr....

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....inding of the ld. Commissioner of Income Tax (Appeals) that the allocation of expenses was required to be made on the basis of turnover as offered by the assessee because the assessee itself considered stamp duty expenses of Rs. 1,00,729/-, transaction charges of Rs, 51,832/- and STT of Rs. 5,23,542/- as expenses, thus, we find no infirmity in directing to consider stamp duty expenses, STT and transaction charges/additional expenses pertaining to speculation activity granting part relief to the assessee. The stand of the ld. Commissioner of Income Tax (Appeals) is affirmed. 4. The last ground pertains to direction to the Assessing Officer to re-work the disallowances made u/s 14A by excluding the stock in trade from the value of investme....