TaxTMI 
TaxTMI 
2018 (11) TMI 1425
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....he year under consideration was filed by it on 24-09-2009 declaring a total income of Rs. 7,845/-. In the said return, a loss of Rs. 68,95,588/- from the share trading was declared by the assessee and the same was set off against income from interest and other income. According to the AO, the loss from share trading as declared by the assesse was liable to be treated as speculation loss as per Explanation below section 73 and the same, therefore, was not allowable for set off against interest and other income. He, therefore, required the assessee company to explain as to why its claim for set off should not be disallowed by invoking the Explanation to section 73. In reply, no explanation whatsoever was offered by the assessee. The assesse ....
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....so filed the rejoinder. After considering this entre material on record, the ld. CIT(A) allowed the claim of the assessee for set off of speculation loss for the following reasons given in para 5.2.5 of his impugned order:- "5.2.5 From the foregoing facts and the legal position, it may be seen that the case of the appellant company is not covered under the Explanation to sec. 73. However, admittedly, the income shown by the appellant at Rs. 66,22,069/- stated in the return of income filed is speculation income only. Therefore, there is merit in the submission that even if the explanation below section 73 is applying in the case of the appellant and the loss from share trading is treated as speculative loss, the same would be allowed to ....
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....culation gain of Rs. 66,22,069/-, though the AO finds that despite repeated opportunity, the assesse could not appear to explain such set off. 2. That on the facts and in the circumstances of the case the ld. CIT(A) erred in allowing the expenditure of Rs. 2,68,950/- which was also not been explained the show cause during the course of assessment proceedings." 6. We have heard the arguments of both the parties and also perused the material available on record. As regards the issue involved in ground no.1 relating to assessee's claim for set off of share trading loss against other income, it is observed that the ld. CIT(A) has allowed the same after having found that the case of the assesse was not covered under Explanation to section 73.....