2006 (7) TMI 93

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....is aggrieved by disallowance of claim for loss on account of purchase and sale of securities. 3 The assessing officer, the appellate authority as well as the Tribunal held that the investment in units of JM Mutual Fund was merely to get benefit of dividend income under Section 10 (33) of the Income Tax Act, 1961 and the assessee was not otherwise engaged in the said business. The assessee proje....

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....hases, sales, net profit etc. are same. All the transactions were effected through Kotak Mahindra Ltd.  Even the purchase of units was also financed by that concern. In fact, it appears to be package deal between assessees and that concern under which tax free dividend income to the assessees was arranged. They knew in advance about the record date when the dividend was to be declared. That i....

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....units particularly when such units were intended to be sold immediately, after declaration of 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 ....

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....29,03,226/- 97,29,032 1,50,771 It is this loss of Rs.1,50,771/- which can be adjusted or set off against current year's income and, if not adjustable, can be carried forward to next year. Had there been any surplus, it would have represented dividend income to the extent it was received. However, since we have already held that no such adventure in the nature of trade was carried on by as....