TaxTMI 
TaxTMI 
2016 (4) TMI 427
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....M/s Fair Growth Enterprises Pvt Ltd and Appeal No.137/CIT(A)-VI, Wd. 5(4)/10-11/Kol dated 12.10.2012 for the assessment year 2008-09 in the case of M/s Hari Finance & Trade Pvt Ltd against the separate orders of assessment framed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the 'Act'). 2. The issue involved in both the appeals are identical and as assesses are different , they are taken up together and disposed off by this common order for the sake of convenience. 3. The only issue to be decided in both the appeals is as to whether the disallowance could be made in the facts and circumstances of the case towards loss on commodity transactions. 4. The assessee has raised the following grounds in ITA No. 1876/Ko....
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.... assessee had incurred a loss of Rs. 62,61,870/- in commodity transactions which was set off against income arising from purchase and sale of shares. The assessee claimed that it is engaged in the speculation business of purchase and sale of shares and also dealing in commodities business. Hence loss incurred on commodity transactions is eligible for set off against profit from sale of shares. The Learned AO observed that the assessee has got interest income from lending activities also which is more than the income from share trading activities and accordingly held that the assessee falls under the exception clause provided in Explanation to Section 73 of the Act. Then he proceeded to disallow the claim of loss on commodity transactions in....
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....income. He further argued that the Learned CIT(A) had treated the entire loss on commodity transactions as bogus based on irrelevant considerations. He further argued that the reliance placed on the decision of Kolkata Tribunal, by the Learned CIT(A) in the case of ITO vs M/s Ellenbarrie Exim Ltd in ITA No. 1871/Kol/2008 dated 21.7.2011 in support of his conclusion that the loss on commodity transaction is bogus and colourable device to evade the taxes, is totally misplaced as the facts in that case are totally different from the facts of the instant case. In response to this, the Learned DR vehemently supported the orders of the lower authorities. 7. We have heard the rival submissions and perused the materials available on record inclu....
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....ed CITA had merely gone by surmise and suspicion by making baseless allegations in his order to reach to a pre-determined conclusion. The Learned CIT(A) agrees that assessee had filed contract notes. Because he uses the same while making one allegation against the assessee. The Learned CIT(A) nowhere concludes that the loss on commodity transactions is non-genuine. He only states in pg 20 para 15 of his order that the genuineness of the loss from commodity trading could not be examined and verified by him. The Learned CIT(A) in order to justify his suspicion ought to have made adequate enquiries with Kshitiz Commotrade Pvt Ltd by using his unfettered powers provided in the statute. Absolutely no enquiry was carried out by the Learned CITA w....