TaxTMI 
TaxTMI 
2016 (5) TMI 219
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....x (Appeals) [CIT(A) is bad both in the eyes of law and on facts. 2(i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the action of the AO in disallowing an amount of Rs. 35,76,559/- holding the same to be speculative loss by invoking the provisions of section 73 of the Act. (ii) That the said addition has been confirmed by arbitrarily rejecting the explanation of the assessee that the gross total income of the assessee consist mainly of income chargeable under the head 'Capital Gain' and 'Income from other sources' and hence the Explanation to section 73 is not applicable to the assessee company. 3. Without prejudice to the above and ....
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....roking and electricity generation and its total revenue as per profit and loss account comprises of income from sale/purchase of shares, dividends earned and interest income. During the year under consideration the assessee filed its return of income on 29/09/2009 declaring a total business loss of Rs. 79,94,913. The assessee has also paid taxes under section 115 JE on the book profits. The case was selected for scrutiny assessment and statutory notices under section 143 (2) was issued to the assessee. The assessee accordingly filed the details start by the assessing officer which were books of accounts along with supporting bills/vouchers and other necessary documentary evidence this. These details filed by the assessee were examined on te....
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....house property, capital gains or income from other sources. 5.3 Ld. A. R. submitted that the loss accrued by the assessee in purchase/sale of shares, is not to be considered while computing the gross total income of the assessee. He further submitted that the manner in which gross total income is to be reckoned is only by disregarding the loss incurred on the purchase and sale of shares. He submitted that for arriving at the gross total income the constituents can only comprise of positive incomes. The Ld. A.R. relied upon judgments of various High Courts and coordinate benches of this Tribunal and the judgment of Hon'ble jurisdictional High Court. 5.4 On the contrary, Ld. D. R. relied upon the orders passed by the authorities below. ....
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....on a speculation business to the extent to which the business consists of the purchase and sale of shares.]" 6.3 On a plain reading of the above explanation, it is clear that in case of a company whose gross total income consists mainly of income from interest on securities, income from house property, capital gains and income from other sources, the loss from purchase and sale of shares of other companies, shall not be deemed to be carrying on a speculation business. In other words if the gross total income of the assessee comprises of any or all the heads of income, then the assessee will fall within the exception carved out in the explanation to section 73 and it could not be deemed to be carrying on a speculative business for the pur....